Figures out from Nationwide today reported average house prices were up 12.2% since the February 2009 trough.
Martin Gahbauer, Nationwide's chief economist, said: “Housing market conditions remain characterised by thin transaction volumes and a relative scarcity of properties for sale, despite a slow return of more sellers in recent months.
"The current supply-demand balance on the market is still consistent with relatively stable to modestly upward trending prices."
The impact of Capital Gains Tax changes proposed by the coalition but as yet unconfirmed on house prices depends on the timing of implementation, said Gahbauer.
He added: “The coalition agreement between the Conservatives and Liberal Democrats contains plans to increase the rate of Capital Gains Tax charged on the disposal of non-business assets, potentially including second homes and buy-to-let investment properties.
“Currently the CGT rate on such assets is 18%, and the coalition plans are to raise the rate to a level “similar or close to those applied to income.”
Details will not be known until the Emergency Budget announcement on 22 June.
“With regard to what the short-term impact will be on the housing market and house prices, the key question is around the timing and implementation of any CGT increase.
"If there is a significant time lag between the announcement of the increase and its actual implementation, then some second home owners and buy-to-let landlords may decide to sell in advance of the higher rate being introduced.
“Such a development could lead the supply-demand balance to shift more in favour of buyers and relieve the current upward pressure on house prices. However, it is difficult to know with any precision how many people would bring forward a decision to sell.
“The incentive to try to beat the higher tax rate is most pressing for those who have owned their properties for a relatively long period of time and therefore have relatively large unrealised gains.
"Conversely, those who bought their second homes or investment property within the last five years have little incentive to sell early in order to beat the tax change. House prices have only risen back to their mid-2006 level and the first £10,100 of capital gains is currently tax free.”
He also said that if the new rate comes into effect immediately on 22 June, then supply conditions are unlikely to be affected materially as any potential sellers would not have time to react.
He added: “The most recent change in CGT rates announced in the 2007 Pre-Budget Report did not have any discernable impact on the supply of property on the market.
"At the time, the existing CGT rates of 24-40% – depending on taper relief and income status – were cut to a flat rate of 18%. New instructions to sell property remained very low even after the tax changes were introduced, although this may also have been due to the very weak market conditions prevailing at the time.”
David Smith, senior partner at the UK property consultancy, Carter Jonas, said: "The two main factors that continue to lift house prices are a shortage of stock and low interest rates.
"However, the removal of HIPs has definitely seen more sellers come to market and so the stock shortage will ease in the coming months.
"While these are ideal market conditions for anyone looking to sell, there are question marks around how long they will last.”
