House price annual inflation grew by 9.7% in England, 5.3% in Wales, 2.4% in Scotland and 2.8% in Northern Ireland, taking the average national price to £253,000.
The report pointed out that house price growth is increasing strongly across most parts of the UK, with prices in London again showing the highest growth.
The annual increase is the highest since June 2010 and follows the moderate house price increases the UK has experienced since April 2012.
Annual house price increases in England were driven by rises in London of 17.7%, the South East at 8% and the East of England at 7.7%. England is the only region where property prices are now higher than the pre-financial crisis peak of January 2008.
Excluding London and the South East, UK house prices increased by 5.8% in the 12 months to February 2014 while on a seasonally adjusted basis, average house prices increased by 1.9% between January and February 2014.
Average mix adjusted house prices in February 2014 stood at £264,000 in England, £167,000 in Wales, £130,000 in Northern Ireland and £183,000 in Scotland.
London continues to be the English region with the highest average house price at £458,000 and the North East had the lowest average house price at £146,000. London, the South East and the East of England all had prices higher than the UK average price of £253,000. Excluding London and the South East, the average UK mix adjusted house price was £196,000.
In February 2014, prices paid by first time buyers were 10.5% higher on average than in February 2013, up from an increase of 7.6% in January 2014. In February 2014 the average price paid for a house by a first time buyer was £192,000.
For existing owners, prices increased by 8.6% for the same period, up from an increase of 6.5% in January 2014. In February 2014, the average price paid for a house by a former owner occupier was £292,000.
During the year to February 2014 prices paid for new dwellings increased by 6% on average, compared with an increase of 2.5% in the year to January 2014. The average UK house price for new dwellings in February 2014 was £245,000.
During the year to February 2014 prices paid for pre-owned dwellings increased by 9.4% on average, compared with an increase of 7.1% in the year to January 2014. The average UK house price for pre-owned dwellings in February 2014 was £254,000.
Paul Smith, chief executive officer of independent estate agent chain haart, pointed out that in some parts of London house price growth is even greater. 'our data shows it’s more like 30% a year. London is another entity and the rest of the country does not reflect these steep rises,' he said.
'This will create speculation that a bubble is developing, however, while undoubtedly buyer demand is acute and the supply of homes limited we do not feel that this is the case. Across the haart network there are around 30 people per branch who have secured a buyer but can’t find a new home. With wages edging above inflation there will be more disposable income and this should encourage people to trade up and increase the supply,' he explained.
'However, with greater caution from mortgage lenders and with even stricter loan criteria soon to be introduced the market will settle down to a more orderly position. Sellers must be persuaded that they will receive their asking prices and if they wait to trade up they will have to pay more,' he added.
According to Peter Rollings, chief executive officer at Marsh & Parsons, prices in the capital are boosted by insatiable demand for property from both UK and overseas buyers. 'Internationally, prime London property in particular is still seen as an unshakeable pillar of investment, and until other forms of investments become more attractive, London property will continue to be viewed as a global reserve currency,' he said.
'Areas of South West London, such as Balham and Clapham, are showing the highest levels of annual price growth. These are fast becoming hot spots for young families and first time buyers eager to get onto the property ladder and who may have been priced out of more central areas. Strong demand in these areas is creating record conditions for sellers – we recently sold a two-bedroom flat in Fulham for considerably over the asking price, after 72 viewings and 14 offers were received within the space of two weeks,' he pointed out.
'However we anticipate that these record breaking conditions will also encourage sellers to put their homes on the market in the busier spring season, easing the competition among buyers and stabilising market conditions as housing stock is replenished,' he added.
David Newnes, director of Your Move and Reeds Rains owned by LSL Property Services, pointed out that even with the London market out of the equation average prices have risen at a sustainable 5.8% over the past year.
'Confidence among aspiring buyers has seen an uplift from a more prosperous economy, a more accessible mortgage market and rejuvenated jobs environment. With wage growth soon to outpace inflation, many household finances are set to turn a corner. This will help many save that all-important deposit needed to get a foot on the first rung of the housing ladder,' he said.
'But most importantly higher volume house building needs to click into gear to increase supply. In turn this will help relieve the competition over available properties and ensure that the cost of housing does not climb too quickly. Slightly tighter lending conditions coming into play will ensure that borrowing remains sensible and sustainable and that the property market continues to improve in manageable steps,' he added.
