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House prices rise at a faster pace than expected

House prices rose at their fastest annual pace in more than a year in March Credit: PA

House prices rose at their fastest annual pace in more than a year in March, Nationwide has announced today.

The surge is a result of buyers of properties to rent and second homes trying to beat the introduction of a new tax, the mortgage lender said.

Property prices were 5.7% higher in March compared with the same month last year, a bigger increase than the 4.8% gain in February.

For the month, house price growth rose to 0.8% from 0.4%, Nationwide said.

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House prices in South East 'could surpass London'

The cost of a home in the South East of the UK or "commuter belt" could soon rise higher than the price of a home in London, a property expert has warned.

Hometrack's research director Richard Donnell said the price of a home in counties like East Sussex and Kent could rise beyond the London market, after the property analysts found the cost of a home had risen by at least 5% across 20 UK cities.

There are still bright spots of activity amid reports of a wider national slowdown.

For the first time since the financial crisis, an improved economic outlook has seen house prices in cities outside the south of England rising off a low base.

By the end of the year, we could well see monthly house price growth in London slipping below that of some of the major cities outside the South East.

– Richard Donnell

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Average house price rises from London-Aberdeen 2014

Here are average house prices in the UK's 20 major cities in October and the year-on-year percentage growth:

  • London, £402,800, 17.3%
  • Bristol, £217,300, 13.2%
  • Cambridge, £331,000, 12.2%
  • Portsmouth, £194,700, 9.4%
  • Southampton, £189,500, 9.0%
  • Oxford, £333,400, 8.9%
  • Edinburgh, £194,400, 8.7%
  • Belfast, £114,900, 8.3%
  • Nottingham, £128,500, 8.1%
  • Aberdeen, £190,000, 7.9%
  • Cardiff, £176,400, 7.9%
  • Bournemouth, £242,300, 7.6%
  • Manchester, £137,000, 7.6%
  • Leeds, £140,400, 7.3%
  • Newcastle, £123,800, 6.9%
  • Leicester, £143,100, 6.3%
  • Birmingham, £133,700, 6.1%
  • Sheffield, £125,700, 5.7%
  • Liverpool, £109,700, 5.5%
  • Glasgow, £110,100, 5.5%

House prices rise 5% 'across UK's 20 largest cities'

The cost of a house has risen by at least 5% in 20 of Britain's major cities, with experts pointing to growth as a sign of the economic recovery finally trickling out of the London.

This is the quickest growth in house prices nationwide since 2004. Credit: PA

Property analyst Hometrack revealed there was still a wide discrepancy between the north and the south in terms of house prices, with the cost of a home in London rising by 17.3% or by 5.5% in Liverpool and Glasgow.

However, this was the first time in a decade that house prices have risen year-on-year by more than 5% in all 20 cities.

Bristol emerged as the second priciest place to buy a home in the UK, with the cost of a house rising by 13.2%.

Despite the dramatic growth, house price rises are starting to cool again, Hometrack found.

Growth had slowed in April after banks applied tough "stress tests" about the spending habits of those they lent to, and growth slowed sharply in cities like Oxford and Cambridge over the last few months.

House prices: Gap in London and rest of UK 'widest ever'

The gap in house prices in London and the rest of the UK is the widest it's ever been, reports ITV's Business Editor Joel Hills.

See the chart below for a national breakdown.

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