This follows the moderate house price increases the UK has experienced since April 2012 and is driven in large part by increases in London. The average UK mix-adjusted house price in September 2014 was £273,000.
Annual house price increases in England were driven by an annual increase in London of 18.8% and to a lesser extent increases in the East (13.4%) and the South East (11.6%). Excluding London and the South East, UK house prices increased by 9.1% in the 12 months to September 2014.
House price annual inflation was 12.5% in England, 5.8% in Wales, 7.6% in Scotland and 10.9% in Northern Ireland.
On a seasonally adjusted basis, average house prices increased by 0.5% between August and September 2014, compared to an increase of 0.3% in average prices during the same period a year earlier.
This month has seen house prices in a number of regions fall back from the record levels witnessed in August 2014. Only house prices in the East of England remain at record levels.
The average price for properties bought by first-time buyers increased by 13.3% over the year to September 2014, up from an increase of 12.9% in August 2014. This is the highest annual increase in prices for first-time buyers since March 2005, when prices increased by 18.3% over the year (although prices also increased by 13.3% in July 2007). In September 2014 the average price paid for a house by a first-time buyer was £209,000.
The average price for properties bought by former owner-occupiers (existing owners) increased by 11.5% in the year to September 2014, up from an increase of 11.2% in August 2014. This is the highest annual increase for existing owners since July 2007, when prices increased by 11.9%. In September 2014, the average price paid for a house by a former owner-occupier was £314,000.
During the year to September 2014 prices paid for new dwellings increased by 10.3% on average, compared with an increase of 12.4% in the year to August 2014. The average UK house price for new dwellings in September 2014 was £251,000.
During the year to September 2014 prices paid for pre-owned dwellings increased by 12.2% on average, compared with an increase of 11.7% in the year to August 2014. This is the highest annual increase for pre-owned dwellings since July 2007, when prices increased by 12.5%. The average UK house price for pre-owned dwellings in September 2014 was £275,000.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said:
"With UK house prices rising 12.1 per cent over the 12 months to September, there is still plenty of momentum in the market.
"Gross mortgage lending dipped in September, suggesting that buyers have concerns about the prospect of a rate rise. However, since then, the Bank of England has sent clear indications that interest rates won't rise until next autumn at the earliest.
"Swap rates remain low and lenders are keen to make up for lost ground caused by implementing the mortgage market review. As a consequence, there are some excellent fixed and tracker rates available.
"With the spring likely to be a challenge for the housing market ahead of the general election, lenders will continue offering fantastic deals to entice buyers and those remortgaging."
Guy Meacock of buying agency Prime Purchase, said:
"There are many opportunities for buyers this autumn. After five years of strong house-price growth, there is plenty of uncertainty, with the forthcoming general election, possible mansion tax and an interest rate rise next year – all of these mean that the next six to nine months is likely to be an improving market for buyers. Estate agents will also be advising vendors to alter their expectations downwards as they head towards the end of the calendar year.
"In London new records are still being made on unusual and special properties. The market is still strong for the right property and only a fool would generalise about a market like London which has more micro markets than ever.
"We are in the business of buying the best in class and that tends to hold its value. For example, during the credit crunch, certain properties fell 30 per cent in value but lateral flats on the best garden squares with the best layouts hold their value much better than a property on a busy road.
"The London market is primarily driven by location. I am surprised by the premium being paid for new-build products in secondary areas. But it's all about supply and demand. They won't build another Eaton Square, or something with a similar history, so such areas have an intrinsic value. There is a finite number of properties on the market at any given time.
"Those who believe in the long-term fundamentals of London won't be swayed. Even if a mansion tax is introduced, we will be going from a very benign tax system to one that is more in line with other cities in the world."
