September house prices up

September saw another rise of 1.5 per cent in house price inflation as the annual rate climbed to three per cent, according to the Halifax bank.

Although only slightly higher than the 2.5 per cent rise recorded in August, the figures from the Halifax suggest the housing market may be picking up again.

As the Bank of England's (BoE) interest rate cut in August gave a boost to potential homebuyers, Halifax's chief economist Martin Ellis says the number of Britons taking out mortgages has increased - although he doubts we will see a surge in inflation again.

"The reduction in economic growth this year and the continuing high level of house prices in relation to average earnings are expected to prevent a sustained surge in house prices," he said.

Latest figures from the Royal Institution for Chartered Surveyors' (RICS) also suggest this to be true, as it reports its members had seen a rise in enquiries from new buyers in September ? a third consecutive monthly increase.

However, Howard Archer, chief economist at Global Insight was sceptical, claiming: "If house prices start accelerating markedly again, we believe buyer interest will quickly wane."

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