House prices to exceed £300k

If such trends continue, prices will near the half a million mark in London by 2012, from the current average of £318,864.

Even in regions traditionally regarded as cheaper – such as the North West and Yorkshire – average prices will break through the £200,000 level.

“Our report shows that continuing house price rises and the resulting housing crisis are set to stay with us for a long time,” said NHF chief executive David Orr.

And while homeowners may view the surge in prices as good news, Mr Orr did warn they carried a “sting in the tail”.

“A growing number of parents will find themselves subsidising their sons’ and daughters’ mortgages,” he said.

“And, across the country, more and more people are going to find themselves priced out of the property market – a decent home.”

In order to tackle the problem the government must press ahead as soon as possible with its plans to build more homes – and make sure an additional 70,000 social homes are built each year, the NHF report added.

The government has vowed to act to tackle the country’s property problems with the publication of the Housing Green Paper last month.

Among the proposals were plans for more than 70,000 affordable homes a year to be built by 2010/11.

The building drive aims to tackle housing supply problems – local government figures show there is demand each year for 210,000 homes, but only 165,000 are being built.