Is there a bubble?
HOUSE prices rose at their fastest annual pace in more than three years in September - stoking yet more fears of a property bubble.
For the first time since 2007, ALL 13 UK regions have seen annual house price growth, according to Nationwide.
The figures are signs that 'the pick-up is becoming increasingly broad-based', the building society said.
But experts have also warned that a housing price bubble could emerge as demand for housing continues to far outstrip supply. The annual rate of house price increases rose to 5 per cent across the country, marking the strongest uplift seen since July 2010. House prices were up by 3.6per cent in Wales year-on-year.
Prices are also up by 0.9per cent month-on-month, following a 0.7per cent monthly increase seen in August, meaning the typical UK home is now worth £172,127. Fears have been growing in recent months that Government schemes such as Funding for Lending and Help to Buy could be helping to stoke up a house price 'bubble', with people overstretching themselves. But these concerns have been dismissed by lenders and by Chancellor George Osborne.
Nationwide's chief economist Robert Gardner warned that house building was still running at levels below what is needed to keep up with demand, which will fuel the upward pressure on prices.
He said the acceleration in house price growth from a subdued pace last year had been 'surprisingly quick', although prices are still way off their previous peaks in many areas of the UK.
He said: "Overall, UK house prices are still around 8per cent below their 2007 highs. However, there is still significant regional variation, with prices in Scotland, Wales and the North of England around 12per cent to 14per cent below their previous peaks.''