London drives house price increase, says ONS

Annual house price inflation was 10.2% in June, compared with 10.4% in May, according to the Office for National Statistics (ONS).

The rise was again driven mainly by London, where house prices increased by 19.3% over the year, a slight drop from the previous month's figure.

Excluding London and the South East, prices rose by 6.3% across the UK.

Prices were up in every region, including Northern Ireland, where they rose by 4.9%.

"House prices are increasing strongly across most parts of the UK, with prices in London again showing the highest growth," said the ONS.

The average house price in London is now almost half a million pounds, at £499,000, compared with the national average of £265,000.

The ONS defines London as its 32 boroughs plus the City of London.

In the UK as a whole, prices paid by first-time buyers in June 2014 were 12% higher on average than in June 2013.

Housing charity Shelter said that many people risk being priced out of the market.

"No matter how hard people work or save, millions are being priced out of a home of their own, caught in the 'rent trap' and constantly moving from one expensive property to the next," said Campbell Robb, Shelter's chief executive.

"The only solution is for politicians to roll up their sleeves and build the affordable homes we so desperately need."

However, online estate agents Housesimple.co.uk said that prices in many parts of the country had not recovered to pre-recession levels.

"Local housing markets remain extremely fragile," said Housesimple.co.uk managing director Alex Gosling, giving the examples of the English North West and Humber regions.

Although there was a slight fall in the rate of house price growth between May and June, the ONS said it was too early to say whether this indicated that the housing market was starting cool.

The official figures are based on actual transaction prices, and use a different methodology to other surveys, including by building societies Nationwide and Halifax.

In July Nationwide said house prices had started to moderate, but in August Halifax said prices were up 10.2% from a year earlier.