The housing market in South East Wales is on the up, as confirmed by new House Price Index figures released by the Principality building society.

House prices in Newport, Torfaen, Blaenau Gwent, Monmouthshire and Caerphilly have all grown on average in the past 1 months.

The value of homes in Newport has grown by 4.7 percent in the last year, with the average house price in the local authority now sitting at £185,869.

Monmouthshire had the highest rate of change in prices over the last 12 months at 8.6 percent and is also the local authority area with the highest average house price in Wales, at £279,434.

Torfaen house prices grew by 7.7 percent with the average house price now at £159,633, while Blaenau Gwent and Caerphilly’s house prices grew by 4.6 percent and 0.4 percent respectively.

The average house price in Caerphilly is £143,419, while in Blaenau Gwent it is £98,376.

Overall, there are 10 local authorities in Wales where the annual price increase exceeded 4.5%, and 12 areas where the rates were lower.

A spokesman for the Principality said: “The Severn Bridge toll fees are due to cease before the end of 2018, making commuting to cities like Bristol much cheaper. This could see a rise in property sales in Monmouthshire and nearby towns and cities across South East Wales.”

But Newport Estate Agent Mark Roberts, director of Roberts Estate Agents, explained that while the imminent removal of the tolls might be a catalyst, it isn’t the main driver behind rising house prices.

Mr Roberts said: “There is a strong Bristol influence at play, which is just massive. What we’re seeing is that with the property prices in Bristol as high as they are you can pick up the same property in Newport, for example, for around 50 percent less.

“The second factor is a lack of properties coming into the market. This pushes prices up. For maybe 10 years there was strong investor market at play. But now those investors are holding on to their properties for longer.

“Another thing is the affordability issue. I would say that if you wanted to move from a terraced house to a semi-detached, the jump could be as much as £100,000. In my opinion, that’s making people think twice, which in turn is pushing prices of available properties up.

“What the bridge tolls will affect is the jobs market. People from Newport will be far more willing to work in Bristol without the tolls.”

Tom Denman, Chief Financial Officer at Principality Building Society, said: “As expected the Welsh housing market continues to grow at a modest, steady rate, as homeowners continue to take advantage of historically low borrowing rates.

“The market is still being driven largely by first time buyers and re-mortgaging. The number of mortgages for first time buyers is growing at twice the rate of the rest of the UK in Wales and it would appear Help to Buy Wales has clearly had a positive impact on the housing market.

“This is welcome news for those looking to step on to the housing ladder in Wales.”