West Midlands house prices at record high

Figures from the Office for National Statistics show prices have soared 7.3 per cent from the previous high of £184,000.

UK house prices have also reached a new record high of £272,000 on average after surging by 11.7 per cent over the last year.

The West Midlands was one of several UK regions that saw house prices reach fresh all-time highs in July, with it, the East Midlands and the South West now joining London, the East and the South East in having price levels higher than their pre-financial crisis peaks of 2007-2008,

Charles Haresnape, managing director for mortgages and commercial lending at new British bank Aldermore, said: "The housing market picked up momentum again in July as we saw record numbers of first time buyers entering the fray assisted by the Help to Buy scheme and increasingly competitive mortgage deals.

"The pace of growth has picked up all around the country which is fine if you're an existing owner but really piles on the pressure for those still wanting to buy a property. I sense that there is a growing sense of urgency among borrowers that they need to get on the housing ladder now or miss the boat altogether."

Property values in London continue to rise faster than the rest of the country, recording a 19.1 per cent year-on-year jump and taking the average property price in the capital to £514,000.

On a month-on-month basis, property values increased by 1.6 per cent across the UK between June and July.

House prices in England are now 13 per cent above their previous high, while those in Scotland have climbed to 0.7 per cent above previous peak levels.

The report also showed that first-time buyers face having to pay 13.5 per cent more to get on the property ladder than they did a year ago - and the ONS said this is the highest annual increase recorded for this sector since March 2005.

The average price paid by a first-time buyer in July this year was £209,000.

Figures released by the Council of Mortgage Lenders (CML) last week showed that the number of mortgages handed out to first-time buyers passed 30,000 in July, marking the first time this has happened during a one-month period since August 2007.

But first-time buyers are typically having to borrow record amounts to get on the property ladder, with the average size of a new loan taken out by this sector standing at £127,500 in July, according to the CML's figures.

The current low interest rate environment is helping to keep borrowing costs down, but home owners have been warned to start thinking now about how they will cope with the prospect of higher payments when the Bank of England base rate eventually starts to move off its historic 0.5 per cent low.