The price of the average house edged closer to the #200,000 mark in September, according to a Government report.

Figures from the Department for Communities and Local Government – the former Office of the Deputy Prime Minister – showed that the average price of a typical property rose to #198,552 during the month.

This was up 0.8 per cent on the previous month’s #197,009, and puts the annual rate of house-price inflation at eight per cent.

In the West Midlands, the average price rose by about 7.5 per cent during the period to around #175,000.

The pace of inflation in the UK increased during September. House price inflation for first-time buyers jumped to 7.7 per cent in September, up from 6.8 per cent in August.

It put the average price for first time buyers at #152,633, while the typical price paid by someone who already owns a house was recorded at #218,139, the department for Communities and Local Government said.

Commenting on the figures, Howard Archer, chief UK and European economist at Global Insight, said it showed that house prices continued to have upward momentum.

But he added that, going forward, the property market could see a dampening in activity and prices.

He said: "The further rise in mortgage payments following last week’s interest rate hike, and markedly rising house prices will add to affordability problems and seem very likely to increasingly squeeze buyers out of the market."