House prices rose again in August, official figures reveal.

The Department for Communities and Local Government (DCLG) August House Price Index shows that not only did the average house price increase, but the inflation rate also rose.

The average UK house price in August was £197,631, up from £194,454 in July 2006, while inflation stands at 7.7 per cent, an increase from July's rate of 6.0 per cent.

"Official government house price statistics showed August was a strong month for the property market, with the annual inflation rate of 7.7 per cent being the strongest since March 2005," commented Milan Khatri, chief economist at the Royal Institution of Chartered Surveyors.

"With the economy growing firmly and households viewing their finances as strong, the housing market will remain robust in the coming months," he added.

The continuing strength of property prices may leave more people able to use their home in order to secure a loan, releasing the capital to make home improvements or for other purchases.

The full report is available from the DCLG website.

Posted by: Peter Kudela
Date: 11th October 2006