06/08/2014 05:21 BST | Updated 06/08/2014 05:59 BST

UK House Prices Soar At 'Fastest Annual Rate Since 2007'

Oli Scarff via Getty Images
LONDON, ENGLAND - JUNE 03: An estate agent sold sign is displayed outside a property on June 3, 2014 in London, England. Figures from the Nationwide, the UK's largest building society, have shown that in the year to May, the annual rise in house prices was 11.1% which represents the greatest rate of increase in seven years. (Photo by Oli Scarff/Getty Images)

Average house prices shot up by 10.2% year-on-year in July, marking the strongest annual upswing seen since 2007, Halifax has reported.

The increase pushed average property values to £186,322, with a 1.4% uplift also recorded month-on-month, reversing a 0.4% monthly dip in June.

The annual increase in house prices is the strongest seen since a 10.7% rise was recorded in September 2007 and the latest figures also mark the first time since then that year-on-year house price growth has hit double digits.

Halifax said that month-on-month price changes can often be volatile and quarterly movements in prices tend to give a better indication of the underlying trend in the market.

On a quarterly basis, house prices in the three months to July were 3.6% higher than in the three months to April, representing the biggest quarterly uplift since December 2006.

Stephen Noakes, mortgages director at Halifax, said: "While supply remains low, housing demand continues to be supported by a continuing economic recovery, growth in employment, improving consumer confidence and low mortgage rates."