HOUSE prices in York have surged by 3.8 per cent in the past year, meaning they are now only 5 per cent off their peak in 2007.

Latest data from the Land Registry shows that the average price of a property in York is now £182,929, as the London price boom spreads out across many parts of the country - fuelling concerns about difficulties for young people in owning their own home.

York's average price compares with a figure of £170,495 for North Yorkshire, where prices rose by 2.6 per cent over the past year, and of £129,447 for East Riding of Yorkshire, where they increased by 2.4 per cent over the year.

The gulf between York and the rest of this region is even greater when the city is compared to West Yorkshire, where the average price is £108,096, South Yorkshire, where the average is £101,949 and Middlesbrough, where it is only £75,611.

Nick Talbot, a director of Jackson-Stops & Staff's York office, said the city was experiencing more activity than for several years because of rising confidence. "People are happy to start investing in property again," he said.

He believed the increase was fuelled by the historic city's good communications, transport links and schools, along with a shortage of high quality property in parts of the city, such as Bootham and The Mount.

But he did not think the rises amounted to a house price boom, and he felt the city was a long way from seeing its property bubble bursting.

Ben Pridden, head of residential at Savills' York office, said he believed property prices in some of the city's best locations were now back at their 2007 peak.

"We have just sold a property at an address just off The Mount for exactly the same price as it sold for in 2007," he said.

He thought York's prices were rising faster than elsewhere in Yorkshire partly because of the city's good commuter links by train and car with Leeds, where some of the well-paid jobs were based.

The Homeowners Alliance, a consumer lobby group, said people were becoming increasingly concerned that owning their own home was becoming an impossible dream for young people.