British house price rises picked up speed and increased more quickly than expected in August as a shortage in the market outweighed the impact of Britain's Brexit vote and a recent tax increase.

A survey from mortgage lender Nationwide shows prices rose 5.6% in August compared with the same month last year and faster than July's 5.2%.

Nationwide said that while buyer demand has softened, the number of new homes coming to market has also been low.

This has kept the balance of demand and supply tight, which in turn has supported prices.

Economists polled by Reuters had expected house prices to rise 4.8%.

In monthly terms, house prices rose by 0.6%, from a rise of 0.5% in July.

A Bank of England report showed this week that the number of mortgage approvals made to home buyers fell to its lowest level in a year and a half in July, in signs that the vote to leave the EU had a cooling effect on the market.

A stamp duty hike for buy-to-let investors, which came into force on 1 April, has also put the brakes on some activity.

"The pick up in price growth is somewhat at odds with signs that housing market activity has slowed in recent months," Nationwide economist Robert Gardner said.

"However, the decline in demand appears to have been matched by weakness on the supply side of the market."