Average house price has shot up £25,000, survey reveals

At this extraordinary pace, the average home has 'earned' more money than the average worker over the last 12 months.

• Lenders under fire as 2million homeowners have mortgages over £150,000

Despite getting up and going out to work every day, a typical full-time worker is paid just £23,500 - but loses about £6,000 to the tax man.

But their home has 'earned' £25,570 and not a penny of the profit is lost to the tax man.

Rightmove, the property website giant, reveals that asking prices in England have jumped 13 per cent over the last 12 months.

The average asking price - the price that an estate agent markets the property for sale - is now £221,751 after a rise of £70 every day.

This is the fastest rate of house price inflation since the record-breaking year of 2002 when asking prices jumped 22 per cent.

It is the eleventh consecutive year that house prices have been going up in this country since the record run began in 1996.

In London, house price growth has been even more staggering this year, causing misery for anybody struggling to buy their first home in the capital.

In the exclusive borough of Kensington and Chelsea, a typical home costs more than £1.1 million after an almost unbelievable 56 per cent price rise.

Other boroughs were not far behind, with prices rises of more than 30 per cent in eight other boroughs such as Westminster, Camden and Wandsworth.

And house prices are going to keep on rising, possibly by up to 15 per cent in London and the South East, according to property experts' 2007 forecasts.

Miles Shipside, commercial director of Rightmove, said £9 billion City bonuses are fuelling the soaraway market in London and the South East.

He said: 'For many, City bonuses are expected to be 25 per cent higher than last year.

'As money appears to be no object to the fortunate recipients, this is feeding through directly to property prices.'

Elsewhere, prices are rising largely because there are too few homes and too many people trying to buy them.

Every year, about 160,000 homes are built in Britain, but 200,000 new households are formed, largely from divorce and immigration.

Evidence of the continuing price rises is terrible news for first-time buyers who can hardly believe that prices are still going up.

Young people who do manage to get onto the property ladder usually have had financial help from their family, typically a 10 per cent deposit or an offer to guarantee their mortgage.

Even then, a young person is forced to borrow 3.25 times their salary, the highest 'income multiple' since records began, according to the Council of Mortgage Lenders.

Bob Pannell, head of research, said the level of debt which young people are having to take on to buy a home is a growing concern.

To make matters even worse, the majority of young people have to pay stamp duty tax when they buy a home, a depressing landmark reached for the first time in March.

He said: 'The Government needs to act. There is immediate scope to reform the current framework for stamp duty on residential properties.

'The Government is clearly undermining its own efforts to help would-be home-owners when a quarter of first-time buyers in London are forced to pay higher rates of stamp duty.'

Overall, the Rightmove figures show asking prices dropped 0.3 per cent this month (December), with a particularly sharp fall of 3.3 per cent in the South West.

Despite the tiny fall, which is irrelevant considering a 162 per cent rise since 1996, the average price is still above £150,000 in all English regions.