U.K. house price inflation unexpectedly accelerated for a second straight month in September to reach a six-month high, figures from the Office for National Statistics showed Tuesday.
The house price index rose 6.1 percent year-on-year following a 5.5 percent increase in August, revised from 5.2 percent. Economists had expected a 5.4 percent climb.
The latest rate of increase in house prices was the fastest since March, when they grew 9.6 percent.
House prices inflation was driven by an 8.4 percent rise in prices in the East and 7.4 percent increase in the South East.
Further, London house prices increased 7.2 percent annually, which was much faster than the 5.4 percent gain seen in August.
An ongoing shortage of supply coupled with strengthening demand may be behind this increase in the growth rate, the ONS said.
Month-on-month, house prices climbed 0.8 percent in September after 0.9 percent gains in each of the previous two months.
The average UK mix-adjusted house price in September was GBP 286,000 compared to GBP 285,000 in August. A year ago, the price was GBP 273,000.
IHS Global Insight expects house prices to see solid increases over the coming months amid healthy buyer interest and a shortage of properties. The firm’s economist Howard Archer predicted around 6-7 percent rise in house prices in 2016.
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