House prices in 75 per cent of postcodes across England and Wales registered price gains over the past year, up from a fifth in 2012, according to the property analyst Hometrack.

The report found that soaring demand and weak supply has pushed the average home up 4.4 per cent to £206,726 following a 0.3 per cent dip last year.

London and the south east experienced the biggest gains with annual price hikes of 9.1 per cent and five per cent respectively.

Meanwhile house prices in northern England tumbled by 0.5 per cent.

Hometrack said in a statement: “The strongest market conditions and impetus for price inflation is set to remain focused on southern England. A broader-based recovery in the housing market is dependent upon growth in the real economy, jobs and household incomes.”

On a month-on-month basis, prices rose by 0.1 per cent in Yorkshire and Humberside and the north-west, by 0.2 per cent in Wales, by 0.3 per cent in the West Midlands and the south-west, by 0.5 per cent in East Anglia, by 0.7 per cent in the south-east and by one per cent in the Capital.

House prices remained the same in the east Midlands and the north-east.

Hometrack said buyer demand rose by 25 per cent in 2013 which marks the fastest rise in three years.

In contrast the supply of homes for sale rose six per cent, the slowest pace since the survey began in 2001.