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House prices up by 0.3% in August

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House prices in England and Wales are at their highest level for two years, according to the Land Registry.

Its figures show that prices rose by 0.3% in August, with the average home now costing £167, 423 - a price last reached in August 2008.

The increase in August, half the size of the gain in July, meant prices increased for the fifth consecutive month, although the annual rate of growth fell from 6.8% in July to 6.7% in August.

But the headline figures masked wide regional variations. Prices fell by 1.4% in Yorkshire and the Humber in August, and also dropped in the East, North West, North East and South West.

At the other end of the scale, the value of a home rose by 1.2% in the West Midlands and 1.1% in the East Midlands.

Other groups also gave a more pessimistic outlook. Nationwide said prices fell by 0.9% during August, while the Council of Mortgage Lenders said lending was at its lowest level for a decade, and HM Revenue & Customs reported a 6% fall in transaction levels.

The latest downturn in the market is not reflected in the data from the Land Registry, whose index measures prices at the end of the buying process. Therefore, it often lags behind other indexes by around three months.

Some economists have predicted the housing market is heading for a double dip, as demand from potential buyers eases, while a rising number of homes are being put up for sale.

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