In Britain the average home is now worth £199,679, as house prices rose 9.4 per cent over the course of the past 12 months, a new report from Haart shows.

According to propertywire.com, London homes are increasing in price even more dramatically, as values rocketed 26.1 per cent over the same period. The average property in the capital now sells for £501,056.

The number of new buyer registrations has risen 10.8 per cent annually, but the supply of homes on the market has decreased by 1.7 per cent. This is one of the key reasons why house prices are increasing so fast and it’s particularly bad news for Londoners, as they could soon be forced into the three per cent stamp duty bracket.

Paul Smith, CEO of Haart, says this is an issue which must be tackled before the elections next year.

“The way to put the brakes on price growth is to increase supply, but in London we have only seen new property instructions rise 0.2 per cent annually and new properties for sale across the UK as a whole are down 1.7 per cent,” he explains, reports mortgagesolutions.co.uk.

“Homeowners can help break this cycle by putting their property up for sale before finding somewhere themselves thus freeing up supply.”