The Hometrack February survey of the housing market reports a 0.9% increase in house prices across the country, the biggest increase since October 2002 which saw a 1.2% rise. These price rises have been supported by a major and widespread increase in buyer demand relative to supply.

Strong price rises were spread across the whole country. All 52 county areas reported price rises, the highest increases being in the Isle of Wight (2.5%), Cumbria (1.7%), Northumberland (1.6%), Derbyshire (1.5%) and Merseyside (1.5%). Wiltshire and South Lincolnshire were the slowest moving counties, both showing rises of 0.2%, while other slow movers, Surrey, North Wales, Leicestershire and Cornwall all crept up by 0.3%.

Cities with the highest price rises were Bath (2.2%), Lancaster (2.2%), Liverpool (2.2%) and Hull (2.1%). No city experienced falling values this month although Cambridge and Sunderland remained static with no recorded rises.The overall average price of a house has now increased to £148,500 (last month £147,200).

Hometrack’s unique National Demand Index™ shows both the number of properties for sale and the number of buyers registered has increased. The number of new buyers registered, however, has increased at over double the rate of new properties listed, causing a sharp increase in demand in relation to supply. This suggests that further strong house price rises are likely in the coming months.

Average sales price achieved, as a percentage of asking price, continued to rise to 95.7% – regaining a level not seen since February 2003 – and up from a low of 94.3% in the last June’s survey. Again, this suggests that demand is outstripping supply. The average length of time taken to sell a property is 4.6 weeks. There is currently an average of 11 viewings before a sale is achieved.

John Wriglesworth, Hometrack’s Housing Economist, said: “The housing market continues to strengthen. The green shoots that began to appear in January look set to blossom this Spring. Despite recent interest rate rises, mortgages are still very cheap by historical standards. With lenders continuing to relax their lending criteria (increasing the multiples of income on which they are willing to lend) house buyers are happy to pay higher prices for their desired homes. Provided the Government is not stupid enough to raise stamp duty in this year’s Budget, house prices will continue to rise strongly this year. Speculation that there is going to be an imminent housing market crash has as much foundation as a brick on a pavlova.”