House prices soar 8.5pc

On average they climbed by £21,000 annually, while in May alone they rose by 0.9%, on average £2,326.

House prices now stand at £266,013, although taking London out of the equation the figure is £221,212.

David Brown, commercial director of LSL Property Services, said: “As the vigorous health of the UK housing market catches international and media attention, all eyes have been on how the government and regulators will react.

“However, the growing clamour for intervention neglects the fact that when taking inflation into account, only London and the South East have seen house price growth in ‘real’ terms since January 2005.

“The national recovery is gaining strength, bringing with it renewed consumer confidence and a ‘feel-good’ factor to millions of households.”

In London prices have increased by 13.3% annually, as if you take the capital out of the equation prices in England and Wales have risen by just 6.3%.

Despite the glowing yearly figures the housing market is thought to be cooling down.

Brown added: “Annual growth in house sales slowed in May, potentially as a side-effect of the Mortgage Market Review rules introduced at the end of April that have lengthened the mortgage approval process.”

“There are other indications of a cooling in the market – particularly at the top end of the spectrum in London.

“In total, 12 London boroughs have seen prices fall in April, with the exclusive Prime Central boroughs of Kensington and Chelsea and the City of Westminster seeing the largest monthly drop in house prices – down 2.7% and 2.9% respectively since March 2014.

“But outside of the capital, the Help to Buy scheme continues to help first-time buyer demand, the engine driving some of the activity in the regions. If supply could follow suit, this would sustain the housing recovery and could help restore some equilibrium across the country.”