AVERAGE house prices have surged as Londoners continue to descend on the city, it has been revealed.

In the first quarter of the year, the average house price in Brighton and Hove increased by 12 per cent to £337,094.

In comparison, the average UK house price is now £265,312 – up from £232,134 in March last year.

According to a Nationwide Building Society report, property values grew by 14.3 percent annually across the UK – the strongest pace of increase since 2004.

Brighton-based property expert Ted McKechnie, of Clarity Property Management, said the market remains “extremely competitive” with demand heavily outweighing supply.

“This inevitably has resulted in continued increases in local house prices,” he said.

“We are seeing a particular increase in demand for larger homes as buyers and renters search for more space including room to work from home, as well as homes with outside space after being stuck inside for much of the last two years.

“A move from London down to Brighton - and similar areas accessible to London by train - is proving popular.

“This allows people to save money and work from home multiple times a week, whilst having the option to get to London easily if needed in the office.”

Nationwide said it is becoming harder for homeowners to trade up, with price gaps between different property types moving to a record high.

Robert Gardner, Nationwide’s chief economist, said: “Prices are now 21 per cent higher than before the pandemic struck.

“The housing market has retained a surprising amount of momentum given the mounting pressure on household budgets and the steady rise in borrowing costs.

“The number of mortgages approved for house purchase remained high in February at around 71,000 - nearly 10 per cent above pre-pandemic levels. A combination of robust demand and limited stock of homes on the market has kept upward pressure on prices.

“The continued buoyancy of housing demand may in part be explained by strong labour market conditions. The unemployment rate has continued to trend down in recent months from already low levels. Wage growth has accelerated, though it is running below inflation.

“The significant savings accrued during lockdowns is also likely to have helped prospective homebuyers raise a deposit.”

Mr Gardner did warn that the housing market is likely to slow in the quarters ahead.

“The squeeze on household incomes is set to intensify, with inflation expected to rise further, perhaps reaching double digits in the quarters ahead if global energy prices remain high,” he said.

“Moreover, assuming that labour market conditions remain strong, the Bank of England is likely to raise interest rates further, which will also exert a drag on the market if this feeds through to mortgage rates.”

Here are average house prices in the first quarter of this year and the annual increase, according to Nationwide:

– Wales, £201,502, 15.3%

– South West, £300,936, 14.4%

– East Anglia, £277,332, 14.2%

– Yorkshire and the Humber, £199,235, 13.5%

– East Midlands, £227,275, 13.5%

– Outer South East (includes Brighton and Hove, Hastings, Lewes and Worthing), £337,094, 12.8%

– North West, £204,511, 12.4%

– Scotland, £178,289, 12.0%

– West Midlands, £233,136, 11.7%

– Outer Metropolitan, £422,428, 11.4%

– Northern Ireland, £171,095, 11.1%

– North East, £153,029, 10.6%

– London, £518,333, 7.4%