House prices are rising at their fastest annual rate for nearly two years according to latest figures from Britain's biggest mortgage lender.
Halifax said the average cost of a home in the UK went up 4.3% in August to £292,505, the highest level since August 2022, the month immediately before Liz Truss's notorious mini-Budget.
Prices have not been rising faster year on year since November 2022, the lender said, although it also cautioned that this partly reflected the weakness in the market in the chaotic aftermath of the mini-Budget. In London they were just 1.5% higher than a year previously.
On a monthly basis prices rose just 0.3% in August, down from 0.9% in July.
Amanda Bryden, head of mortgages, Halifax, said: "Recent price rises build on a largely positive summer for the UK housing market. Prospective homebuyers are feeling more confident thanks to easing interest rates. That optimism is reflected in the latest mortgage approval figures, now at their highest level in almost two years.
"Such has been the resilience of house prices that the average property is now just £1,000 shy of the record high set in June 2022 (£293,507). While this is welcome news for existing homeowners, affordability remains a significant challenge for many potential buyers still adjusting to higher mortgage costs.
"However with market activity picking up and the possibility of further interest rate reductions to come, we expect house prices to continue their modest growth through the remainder of this year."
Buyi ng activity in the property market has been stimulated in recent month by falls in mortgage rates with many mainstream lenders now offering five year fixes priced at below 4%.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "As mortgage rates have fallen, we have seen activity noticeably increase. Estate agents report that August was busy as motivated movers who may have delayed for a while have got on with their transactions, while we have seen people take advantage of more palatable rates."
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: "The market breathed a collective sigh of relief when first the election result ended lingering political uncertainty and again when interest rates started to fall.
"That added comfort is reflected in this solid, not spectacular, price growth figures from the country's largest lender and reinforced by recent encouraging mortgage approval numbers.
"These show buyers and sellers did not panic but continued about their business over the summer. However, mortgages are still relatively expensive for many and talk of 'a painful Budget' by next Halloween is spooking many into holding off a little longer or at least negotiating harder to avoid what they regard as overpaying."