Southeast drives fastest rise in UK house prices for six years Paul Markey has not paid much attention to the government's latest plan to stimulate the UK housing market. As an estate agent in Brixton, a rapidly gentrifying part of south London, he is too busy selling houses. "It's boom time," he says over the clatter of keyboards in the Brixton office of the Haart estate agency chain. Prices have gone up at least 25 per cent here in the past year. Demand is so strong that he and his colleagues have adopted an "open house" strategy, where they invite potential buyers to group viewings of a property. "We normally sell it on the day . . . and we say to people, "If you want to get in before the open house, you have to pay top dollar," " he says with a grin. Figures released on Monday by Hometrack, a housing data company, show prices rising in Britain at the fastest pace for six years, propelled by places such as Brixton in London and elsewhere in the southeast. Demand is starting to return elsewhere, too, albeit more tentatively. Mike Groves, of Thornley Groves, one of Manchester's largest estate agents, says there are 45 per cent more transactions going through his books than a year ago. Farther north, Sarah Mains, founder and owner of the Tyneside estate agent Sarah Mains Residential, has arranged more than 20 mortgages in the past fortnight, twice the rate of a year ago. Half of them were for first-time buyers. Analysts and estate agents agree - the government's Help to Buy scheme is not the main reason the market is perking up. It has helped to improve sentiment, but demand was already recovering thanks to the strengthening economy and improving mortgage availability, they say. Property values show uneven movement House prices in Britain have recorded their fastest rise for six years, indicating that the tide in the market is turning, writes Ferdinando Giugliano. However, the increase in home values was largely driven by southeast England and London, with the rest of the UK registering only feeble rises. Data from the Hometrack monthly housing survey show that prices rose by 0.4 per cent month-on-month in May - the strongest showing since May 2007. The value of properties in London and the southeast went up by 0.9 and 0.5 per cent respectively. Rises in London are largely being driven by a widening gap between supply and demand. Demand grew by 15 per cent over six months, while supply fell by 0.6 per cent. Values went up by 0.3 per cent in East Anglia, while they remained flat in much of the rest of the UK. "More people are saying, I feel a bit more confident in my job . . . the worst has happened and things are getting better," says Richard Sayer, director of Rook Matthews Sayer, an estate agency with 17 branches in Tyneside and Northumberland. In any case, the more potent element of Help to Buy has not started yet. The scheme has two parts: equity loans for people buying new houses, and government guarantees on up to £130bn of high loan-to-value mortgages. The government will launch this second part, aimed at fixing the "market failure" of banks" unwillingness to lend to people with small deposits, at the start of next year. Last week, the International Monetary Fund joined a host of others in warning that these mortgage guarantees would boost demand but probably not expand supply. "The result would ultimately be mostly house price increases that would work against the aim of boosting housing access," it wrote in its report on the UK economy. Given the indications that demand is already picking up, could Help to Buy help to inflate a housing bubble? Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, says a bit of house price inflation would probably be a good thing in places where activity is still very weak. "The difficulty, of course, is when you're trying to set a policy for a housing market: what might look good in Blackpool doesn't necessarily look good in parts of London," he says. Jeremy Leaf, a surveyor and estate agent in Finchley, north London, says that even if extra demand does encourage supply, the danger is in the time lag. It can take years, not just months [to build new houses], and it's got to be lined up with demand. If it isn't, we're going to see bubbles emerging, particularly in London, where demand hasn't really fallen," he says. But back in boom-town Brixton Mr Markey is unworried. "What's the worst-case scenario?" he asks. Money's easier to get. How bad is that? Additional reporting by Andrew Bounds