This is up from the 2.2% increase in the 12 months to November. In fact, house prices have increased across most of the UK in 2012, although prices in Northern Ireland have continued to fall.
The year-on-year increase reflected growth of 3.4% in England, 2.4% in Wales and 3.1% in Scotland, which were offset by a decline of 5.7% in Northern Ireland. Annual house price increases in England were driven by a 6.4% rise in London and a 3.7% increase in the South East.
However, the London price 'bubble' once again alters the data, with the report showing ha excluding London and the South East, UK house prices actually increased by 1.9% in the 12 months to December 2012.
In December 2012, prices paid by first-time buyers were 2.7% higher on average than in December 2011. For owner-occupiers (existing owners) prices increased by 3.5% for the same period.
Ali Mackay, director of the North East-based property buying agents YappYapp commented:
"Nationally, the picture is a heartwarming one. After a sharp decline and then a listless couple of years, in 2012 house prices enjoyed a gentle return to growth.
"But the regional contrast could not be more striking - while house prices in the North East are encrusted with ice, those in London are being roasted by a blowtorch. The London market's ability to recover from its brief dip never ceases to amaze, with prices there now increasing to ever more dizzying heights.
"At the other end of the scale, the North East has the dubious distinction of being the only one of nine English regions to see prices fall through 2012. The fact is that prices fell harder, further and for longer here. There are pockets of deprivation that never really recovered from the industrial decline of the 1970s. The property crash hit them especially hard.
"Growth is slowly returning, but it is taking a painfully long time. Properties are selling, but many are taking time to shift. How much of this is down to sellers' unrealistic expectations and how much is down to the fact that it's clearly a buyer's market is moot.
"Consumer confidence is in short supply, but at least the mortgage market is helping.The Funding for Lending Scheme is tempting more would-be buyers to take the plunge as lenders are not just cutting rates, but offering more products too - even the high LTV loans they had ignored for so long. For the country as a whole, the worst is clearly past - but stripped of the distorting effect of London, the recovery is still slow."
