House prices have surpassed their 2007 peak to stand at a new all-time average high of £188,903 across the UK in June, Nationwide reported yesterday.
London property values leapt by 25.8 per cent year-on-year to reach £400,404 typically, marking the strongest annual rate of growth seen in the capital for 27 years.
Prices across the UK have jumped by 11.8 per cent over the last year, representing the biggest annual uplift seen since 2005.
But while London and other hotspots have soared, the society said Northern Ireland, was still recovering from some of the sharpest falls seen in the wake of the financial crisis.
As a result it said values have risen by just 8.4 per cent annually to reach around £117,150.
Overall, it said prices in the province were still around half the level they were at their peak.
Values across the country also increased by 1.0 per cent month-on-month, the building society said.
Matthew Pointon, a property economist at Capital Economics, described London house prices as “growing at the fastest pace since the bubble of the late 1980s”.
After London, Cambridge was named as the top-performing city for the housing market. Prices in Cambridge have surged by a fifth to reach £419,187 typically. St Albans was the third strongest-performing city, with values lifting by 18 per cent to reach a £451,800 average.
Newcastle was named as the worst-performing city, with a three per cent annual uplift taking prices there to £181,473 typically.
Across the UK, all regions recorded annual price gains for the fourth quarter in a row, with the largest being in London and the smallest in Scotland, where values have risen by 5.4 per cent annually to reach £141,872 on average.
In Wales, property prices are up by 9.3 per cent on a year ago, now standing at £145,812 typically.
Robert Gardner, Nationwide’s chief economist, said prices passed their 2007 peak levels in the second quarter of this year, “just as UK economic output is likely to have surpassed the high water mark reached before the financial crisis”.