British house prices rise at fastest rate for three years

British house prices have risen at their fastest annual rate since May 2010, according to Halifax.

The mortgage lender said that average house prices were up by 6.9% in the three months to October, compared to the same period last year.

Halifax said that in October alone, house prices rose by 0.7%, stronger than the 0.4% recorded in September but slower than the 0.9% forecast by economists.

Halifax economist Martin Ellis said: “Low interest rates, and higher consumer confidence supported by the increasing evidence that a sustainable economic recovery may now be underway, are helping to increase housing demand.”

Ellis added that demand was also being bolstered by the government’s Help to Buy and Funding for Lending programmes, which offer cheap finance to lenders and high loan-to-value mortgages to homebuyers.

Last month Bank of England governor Mark Carney said more housing market activity and consumer spending was driving the economic rebound that Britain’s economy has enjoyed since the start of the year.