HOUSE prices in Cumbria increased in 2015 for the second year running, but by only 1.3 per cent, official figures show.

The Land Registry says that the average price of homes sold in the county was £122,051 in December, up from £120,457 in December 2014 and from £119,209 at the end of 2013.

The modest annual increases suggest that trend of falling prices since the financial crisis of 2007 has been halted – the price of the average home fell every year between 2008 and 2013.

But the market in Cumbria still has some way to go regain the ground lost since prices peaked at £142,443 in December 2007.

Andrew Gordon, a director of Cumberland Estate Agents, is upbeat about the prospects for 2016.

He said: “We’re expecting the year to be a good one for sellers with demand increasing and prices heading in the right direction.

“In general, the Cumbrian housing market is quite positive.

“Confidence is a key factor, and a steadily improving economy coupled with low interest rates means increasing numbers of people are happier about borrowing a little more and moving up the housing ladder.

“In the main our sellers are getting the prices they want in a relatively short period of time.”

He added: “Whilst we are seeing sale prices increase, it’s true to say that Cumbria doesn’t tend to experience rapid house price growth.

“Prices increase when demand outstrips supply and the demand for property in Cumbria is fairly consistent.”

The property market is seen a barometer of consumer confidence.

A strong housing market tends to boost the wider economy because people are more likely to spend on home improvements and furnishings when they move.

The Land Registry, which monitors all property transactions, says that an average of 725 homes changed hands in Cumbria each month between August and October.

That represents a fall from 750 per month in the same period of 2014 but is significantly higher than the monthly averages of 659, 512 and 595 recorded during the same quarter of 2013, 2012 and 2011 respectively.

Across England and Wales, the Land Registry says, average house prices jumped by 6.3 per cent during 2015 to £188,270, far outstripping the rise in Cumbria. But this national average masks large regional variations.

London saw the biggest annual increase, 12.4 per cent, taking the average price of a home in the capital to £514,097, more than four times the Cumbrian figure.

The smallest increase was in north-east England, where prices rose by only 0.8 per cent and the average home still costs less than £100,000.