"Underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low interest rates."
Average house prices edged up to £237,837 in May following monthly growth of 0.5%, according to the latest Halifax house price index.
In the quarter to May, house prices were 2.5% higher than in the preceding three months and were 5.2% higher than in the same three months in 2018.
Halifax says the high annual growth figure comes against the backdrop of a "particularly low growth rate in the corresponding period in 2018, which has had an impact on year-on-year comparisons".
Russell Galley, managing director at Halifax, said: “We saw a slight increase in house prices between April and May, but the overall message is one of stability. Despite the ongoing political and economic uncertainty, underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low interest rates.
“This is supported by industry-wide figures which suggest no real change in the number of homes being sold month to month, while Bank of England data show the number of mortgages being approved rose by almost 6% in April, reversing the softness seen in the previous month.
“While current conditions may help those looking to make their first move onto the property ladder, existing homeowners will doubtless be considering long-term house price growth which continues to look subdued in comparison to recent years.
“Looking ahead, we expect the current trend of stability based on high employment and low interest rates to persist over the coming months, though clearly any downturn in the wider economy would be keenly felt in the housing market.”
Lucy Pendleton, founder director of independent estate agents James Pendleton, added: “Instead of coming back down to Earth after the huge 5% annual growth recorded last month, we’ve got a new record high on our hands.
“Halifax said last month that particularly high growth in February was behind the meteoric annual figure reported in April. However, instead of the annual rate falling now February has slipped out of these sums, it has increased even further.
“This headstrong performance proves once and for all that when political uncertainty and availability of cheap credit go head to head, borrowing power wins hands down. That has been the case for the past two years.
“Rather than the steady trudge that is typical of house price indices, the Halifax figures have felt more like the anticipatory thrill of the roulette wheel recently. We’re seeing some big numbers nationally on an annual basis and the index continues to dance about like light playing on water.
“The index may continue to raise a few eyebrows while such volatility remains, as it is throwing up results that aren’t mirrored by other indices.”