A new city-level residential index has revealed that values in London and Cambridge have increased by more than three times the UK national average.
House prices in London and Cambridge rose by over £60,000 and £53,000 respectively over the past 12 months, according to Hometrack.
The first UK Cities House Price Index reveals the level of disparity in the UK housing market, with homes in Glasgow adding only £4,500 to their value.
The three cities with the highest house price growth year-on-year were London (18.1%), Cambridge (17.9%) and Bristol (14.1%). The lowest house price growth was recorded in Glasgow (4.3%) and Leicester (4.8%).
“There is little evidence of a runaway surge in prices and the rate of growth appears to be moderating”
Richard Donnell, Hometrack research director, said expectations that strong house price growth in the south of England would ripple out across the country were ”over-done”.
He said: ”While house price growth has increased across all cities in the last year, the rate of growth in the majority of cities is below the UK average.
“There is little evidence of a runaway surge in prices and the rate of growth appears to be moderating.”
On a national level, the overall rate of UK house price growth has, Donnell said, been significantly enhanced by London.
The UK capital has driven the recovery in house prices over the past year, Hometrack concluded. But the monthly rate of growth slipped to just 0.4% in September compared with 1.0% at its peak in April, reflecting weaker demand.
“We are starting to see a corresponding dip in the rate of growth in the national figures as the rate of growth slows in London,” Donnell added.
The annual rate of UK house price growth was 9% in September, up just 0.1% from August (8.9%).
The index found that 14 out of 20 cities recorded house price inflation below the current UK rate of 9%.
Eight cities are now above their 2007 peak, with Cambridge leading the way with a 32.5% increase next to London at 29%.