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House prices rise 'at fastest rate since 2007'

UK house prices rose at their fastest rate since September 2007 and are now 10.2 per cent higher than the same period last year.Halifax's latest house price index reveals prices in the three months to the end of July increased by 3.6 per cent on the previous three months, taking the average cost of a home to £186,322.There was also a 1.4 per cent increase in the monthly figure for July, following a decline in June. However, the lender said this can be a volatile indicator and the three-month figure is more reliable.Mortgages director Stephen Noakes said: "While supply remains low, housing demand continues to be supported by a continuing economic recovery, growth in employment, improving consumer confidence and low mortgage rates. However, earnings growth is still lagging behind consumer price inflation."Despite falling six per cent from a recent peak in February, house sales are close to 103,000 and were 21 per cent higher in the April to June quarter than in the same three months last year.According to the latest Halifax housing market tracker, over half (57 per cent) of those surveyed believe the next 12 months will be a good time to sell, while over 37 per cent think it will be a bad time to do so - the highest score since the survey began in April 2011.News from the bank comes in contrast to other recent reports, which have suggested the Bank of England's lending restrictions could be beginning to cool the market.At the start of the month, Nationwide said house prices rose at their slowest rate since April 2013 last month, up just 0.1 per cent on the June figure. This led to a fall in the annual figure from 11.8 per cent to 10.6 per cent.The building society said there was a 20 per cent fall in mortgage approvals between January and May and registered a softening in some forward-looking indicators, such as buyer enquiries. 

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