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February brings the highest monthly increase in prices since May 04 - upping the annual rate of growth to +6.4%.
The survey also found that concerns over interest rates and a limited availability of housing for sale are acting as major constraints on supply.
Over February the number of properties being registered with agents grew by 14%, yet there was a 23% increase in the number of buyers looking to purchase.
The net result of this has been higher house prices across 42% of the country with two thirds of the price rises concentrated in southern England (London, the South East and South West).
While house prices in London and the South East grew by 1.3% and 0.9% respectively, growth across the rest of the country remained far more subdued. Average prices grew by just 0.1% in the East Midlands, Yorkshire and Humberside and Wales. The selling time in these regions remains above average at 7+ weeks, this compared to London where the figure has continued to fall and now stands at less than 2.5 weeks.
"Despite the January rate rise it seems that a lack of supply is continuing to support higher prices, primarily in London and the South East," comments Richard Donnell, Hometrack's Director of Research.
"The reality is that house prices are being set by a narrowing spectrum of buyers, chasing a limited amount of supply. In the absence of any external shock to demand and the apparent willingness by purchasers to pay what is necessary to access the market, then house prices look set to increase further over the coming months."
Headline results - February 2007
