Home prices in Britain rose 1.6% in September from August, marking the third monthly gain in a row amid signs of economic recovery, a survey from Halifax shows today.
Halifax - a subsidiary of Lloyds Banking Group, which is 43% owned by the British government - added that house prices in September were 7.4% lower compared with the level in the same month in 2008.
'The combination of increased demand and a low level of properties available for sale has pushed up house prices in recent months,' Halifax housing economist Martin Ellis said.
'The marked improvement in affordability due to the reduction in both property prices and interest rates since mid-2007 has been a key factor in stimulating higher demand,' he added.
According to Halifax, the average cost of a British home stood at £163,533 sterling in September 2009.
Later this week, the Bank of England was expected to hold its key interest rate at a record low 0.5% amid hopes that Britain is emerging from a deep recession.
The British economy shrank by 0.6% in the second quarter compared with activity in the first three months of 2009, which was better than the previous estimate of minus 0.7%, recent data showed.
