Bristol is latest property hotspot as house prices rose faster there than any other UK city last year

BRISTOL has become the latest UK property hotspot, after it was revealed today that property values in the city rose faster than any other in the country.

Values in Bristol increased by 9.6 per cent in 2016, while Manchester saw the second highest house price growth across 2016, with an increase of 8.9 per cent.

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According to the Hometrack UK cities house price index, which tracks price movements across the UK's 20 biggest cities, Birmingham also showed strong price growth, with a 7.5 per cent increase in property value last year.

All three cities beat London, which saw prices go up by 7.3 per cent last year - the lowest increase in three years.

The average house price in London is now £484,800, while in Birmingham it is just £147,500.

Hometrack said that with house prices in London now around 14 times earnings, there could be "a prolonged period of price re-adjustment in the London housing market over the coming years".

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Richard Donnell, insight director at Hometrack, said: "2017 looks set to be a year when the North-South divide for house prices might finally start to narrow once again.

"This latest UK city house price index reveals how the impetus for house price growth is shifting to more affordable cities where the recovery in house prices has been more muted in recent years..."

He said that in Manchester the supply of homes for sale is only just managing to keep pace with demand, pushing up house prices.

Aberdeen was the only major city in the index where house prices fell in 2016, however prices there have "posted something of a revival" in the last three months of 2016, Hometrack said.

The average house prices in major cities across the UK in December 2016, and the annual percentage increase in property value last year:

• Bristol, £261,600, 9.6 per cent
• Manchester, £151,200, 8.9 per cent
• Oxford, £422,700, 8.1 per cent
• Portsmouth, £222,400, 8 per cent
• Southampton, £221,700, 7.9 per cent
• Birmingham, £147,500, 7.5 per cent
• London, £484,800, 7.3 per cent
• Cardiff, £195,100, 7.2 per cent
• Liverpool, £116,000, 7 per cent
• Nottingham, £139,900, 5.7 per cent
• Bournemouth, £272,100, 5.7 per cent
• Glasgow, £115,100, 4.9 per cent
• Leeds, £153,400, 4.9 per cent
• Sheffield, £128,500, 4.3 per cent
• Leicester, £156,100, 3.8 per cent
• Edinburgh, £202,300, 3.7 per cent
• Newcastle, £123,100, 3 per cent