House prices jumped by 1.1% in July, according to data from Halifax, and it halved its forecast for falls in the value of property in 2009.

The mortgage lender said it had scaled back its previous prediction that house prices would fall by 15% in 2009 to 7%.

Prices in the three months to July were 0.8% higher than the previous three months, in the first quarterly rise since October 2007.

Prices had previously dipped by 0.4% month-on-month in June after jumping 2.6% month-on-month in May.

Martin Ellis, Halifax housing economist, said: 'Demand for homes has risen, albeit from a very low base, since the start of the year, driven by improvements in affordability and low interest rates. '

Financial Times