The Land Registry House Price Index for January also revealed that the average house in England and Wales now cost £168,356, a 4.2 per cent increase on January 2013 figures.
Data from the Land Registry found that prices in all regions experienced a year-on-year increase in the 12 months to January 2014, with London reporting the biggest rise, jumping 10.9 per cent on January 2013 figures. The average price of a home in the capital now stands at £409,881.
Unsurprisingly, London remained the most expensive place to live, with the average cost of a home comfortably outstripping the second most expensive region, the South East, at £223,128.
The region with the lowest average house price was the northeast of England, where an average house costs just £98,292. However, this region experienced the highest monthly rise, up 2.6 per cent on December 2013 averages.
Martin Stewart, director of London-based mortgage broker, London Money, said: “We are seeing people return to the market who have been absent since 2008. Demand remains high, primarily because mortgages are easier to get than they have been for some years and also because consumers are more confident.”