The ONS says house prices in London and the South-East are still rising while the influential RICS study suggests the market may be "over the very worst”.
House prices continued to rise in 2012, official figures showed today, driven largely by demand for property in London and the South-East of England.
Despite a return to recession for the economy last year, UK house prices increased by 2.1pc to £232,000 in the year to November, up from 1.5pc in October.
But the figures, published by the Office for National Statistics, showed steeper increases in the capital, where prices were up 5pc to £393,000, and the South-East, which registered a 3pc increase.
The ONS survey also reflected a weaker increase in Wales, up 0.8pc, and declines of 1.1pc in Scotland and 8.5pc in Northern Ireland.
It also suggested affordability continuned to worsen for those trying to get on the property ladder. Prices paid by first-time buyers were 2.7pc higher compared to 1.9pc for existing owners who had moved.
Economists said the prospects for the property market remained tough for 2013 with unemployment remaining stubbornly high and with limited growth in wages expected. But central bank attempts to cut mortgage rates could help prop up demand.
Howard Archer, economist at IHS Global Insight, said: "Some support for house prices should come from recent decent employment growth and likely extended low interest rates, while mortgages appear to be becoming increasingly available helped by the “Funding for Lending” scheme launched at the start of August by the Bank of England."
A sharp increase in foreign buyers has been cited for the continuing health of London's property market. This was initially due to the global super-rich seeking protection from global financial uncertainty and tax rises - agents are reporting an influx of French buyers - but more recently agents suggest middle class Chinese buyers with children coming to study in London have been buying property.
It emerged yesterday that investors have rushed in to reserve luxury homes planned for the revamped Battersea Power Station in south-west London, with 600 of the 800 properties already claimed after just five days on the market. River-facing penthouses carry an asking price of more than £6m.
The ONS figures have a two-month between when data is gathered and published. A monthly report by Nationwide building society has since suggested average prices dropped by 1pc for the full year in 2012. Economists today were more focused on a monthly report by the Royal Institution of Chartered Surveyors (RICS) which is based on more recent data.
12-month house price changes. Source: ONS
It showed its most positive reading since 2010 with the organisation suggesting the market may be "over the very worst" . A balance of 24pc more surveyors predicted that the number of house sales will increase over the next three months, compared to those expecting transactions to fall.
The poll of 280 surveyors also showed that property prices held steady in December, marking the first time since mid-2010 that surveyors did not report that prices edged downwards over the previous three months.
Accordingly, the survey showed that for the first time in two and a half years surveyors did not predict further property price drops over the coming three months.
“This more positive outlook comes at a time when confidence has been growing that the market in some parts of the country may now be over the very worst,” said RICS.
The organisation is forecasting that prices will rise by 2pc this coming year.
Peter Bolton King, global residential director at RICS, said: “As we start the new year confidence to the housing market does appear to be improving, helped in part by the impact of the Funding for Leading Scheme. Indeed, our members are predicting that transaction levels will continue increasing in many parts of the country.
“That said, more still needs to be done to ensure potential buyers can access the market at every level.”
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