House prices increased by 2.3 per cent to £237,963 in the year to July, figures from the Office for National Statistics and the Land Registry show.

It comes as the Halifax index published earlier today revealed a sharp increase of 7.3 per cent in the year to September.

The ONS figures for July show that Wales saw the strongest growth with prices up by 3.6 per cent year on year to £170,000, followed by Northern Ireland where prices increased by 3 per cent to £141,000 and England where prices climbed 2.5 per cent to £255,000.

Scotland saw the weakest growth, with prices up by just 0.4 per cent to £155,000.

The West Midlands was the English region to see the highest annual increases with prices up by 4.3 per cent to £206,244.

The South East saw the lowest growth with prices rising 1 per cent to £325,734.

In London, there was a modest increase of 1.3 per cent year on year, as prices reached an average £484,864.

Hargreaves Lansdown personal finance analyst Sarah Coles says: “The housing market has been defying gravity – with a little help from the government – but this winter it could be set for its Wile E Coyote moment.

“The post-lockdown mini-boom kept the market afloat in July, and the stamp duty holiday is likely to fuel even more price rises through August and September.

“The first fly in the ointment was a tightening in the mortgage market, and the disappearance of high loan-to-value mortgages. 

“But yesterday Boris Johnson suggested the government could step in to prop the mortgage market up.

“However, it may not be enough when we face a period of really horrible job losses. 

“Half a million redundancies were planned in the first five months of the virus, and as notice periods come to an end, and the furlough scheme dries up for anyone who can’t work at least part time, the impact of the recession is likely to kick in.

“It’s tough to see how the housing market could come through that unscathed.”