There was also a rise in mortgage approvals in this period, rising by 5.2% between June and July to 68,700.
House prices between June and August rose by 0.1% – the first rise since March, the Halifax House Price Index has shown.
Prices between June and August were 0.1% higher than between March and May this year and 2.6% higher than the same period in 2016.
The annual rate in August is far below the peak seen in March 2016 of 10% when transactions grew sharply ahead of MCD changes.
Russell Galley, managing director at Halifax Community Bank, said: “Recent figures for mortgage approvals suggest some buoyancy may be returning, possibly on the back of strong recent employment growth, with the unemployment rate falling to a 42 year low.
“However, wage growth is still lagging increases in consumer prices, which is likely to add pressure on household finances and increase affordability challenges for some buyers.
“House prices should continue to be supported by low mortgage rates and a continuing shortage of properties for sale over the coming months.”
The average house price is now £222,293 and UK home sales rose to the highest level since March 2016 upon reaching 104,760.
There was also a rise in mortgage approvals in this period, rising by 5.2% between June and July to 68,700.
Jeff Knight, director of marketing at Foundation Home Loans, said: “The market certainly hasn’t been helped by ongoing political uncertainty, particularly around the Brexit negotiations, but core demand for properties is nudging prices up.
“Continued growth will be good news for some homeowners, but may hinder a move up the ladder for others.
“It will also increase deposit sizes for first-time buyers, who are seeing deposits eroded with more challenging inflation versus low deposit rates.”
These figures come as research by GS1 UK, the global supply chain standards organisation, showed an 150% yearly increase on the number of home improvement businesses ordering barcodes.
Gary Lynch, chief executive of GS1 UK, said: “The housing market is such an important part of the UK economy.
"But while this sector has slowed down, the home improvements sector has been able to take advantage and enjoy substantial growth while offering consumers wider choice to improve their homes.”
