Low interest rates and an improving economy are helping the property market.
More than one million properties changed hands last year, the highest number since the start of the credit crisis, according to the latest data from Halifax.
House prices increased by 1.1 per cent in January, with the three month metric showing that prices between November and January are 7.3 per cent higher than the same period last year.
This is marginally lower than December's three month figure, which stood at 7.5 per cent.
Halifax housing economist Martin Ellis said low interest rates and improved consumer confidence have boosted demand in the sector, while positive projections for the economic recovery and falling unemployment figures bode well for its future buoyancy.
However, he still has concerns about the lack of supply coming on to the market at present.
"With the supply of properties being slow to respond to more buoyant market conditions, stronger demand has resulted in continued upward pressure on house prices," Ellis remarked.
As long as earnings fail to keep pace with inflation, he also thinks there will be a "constraint on the rate of growth of house prices".
Jeremy Duncombe, director of Legal & General Mortgage Club, said that it is "encouraging" to see consumer confidence starting to increase as this will enable the market to recover long term.
"In the South East and London the market is being boosted by several factors such as constricted supply and foreign buyers, thus pushing prices up," he added.
But Duncombe stated that "despite recent positivity" transaction levels still remain well below their peak in 2007 and until they rise further the market will remain in the "recovery" phase.
One potential threat to the renewed confidence in the housing market is the looming spectre of an interest rate rise.
"Many are still concerned about the 'bogy' of an interest rate rise," said Nicholas Ayre, managing director of homebuying agency Home Fusion.
However, he thinks it is a "tough call" to tell when Mark Carney, governor of the Bank of England, will make his move.