Average residential values increased by 0.4 per cent over August showing a house price growth of 3.9 per cent for the first eight months of 2006, according to Hometrack.
The firm’s latest housing market survey reveals that the north-south divide in house price growth continued throughout August.
It says that average house values in London grew by 0.9 per cent over August with above average growth in the South West of 0.5 per cent and the South East of 0.4 per cent. In contrast, house prices were static in two regions and up by just 0.1 per cent in three others.
Hometrack says it expects that the mini boom provoked by the London housing market will fade over the autumn months.
Hometrack director of research Richard Donnell says: “Whilst the recent rise in interest rates has yet to impact on the market surveys, the sensitivity of the housing market to interest rates means that the London-inspired mini boom of the last eight months is likely to run out of steam over the autumn.