House prices grew at the fastest annual pace for more than 17 years in March despite the cost of living crisis, according to Nationwide.

Annual growth in house prices hit 14.3% in February, the mortgage lender said, the strongest pace since November 2004.

The cost of a typical UK home reached a new record high of £265,312, rising £33,000 in the past year, it said.

Prices are being pushed higher by robust demand, limited supply and a strong jobs market, it added.

Nationwide, which is one of the UK's biggest mortgage lenders, said the housing market had "a surprising amount of momentum given the mounting pressure on household budgets and the steady rise in borrowing costs".

Households in the UK are being squeezed by a cost of living crisis, with prices rising at their fastest rate for 30 years as fuel, energy and food costs surge.

Mortgage costs are also rising after the Bank of England raised interest rates three times in four months to try to help lower that price inflation.

But these factors have not dampened acceleration in house price growth, Nationwide said.

House prices are now more than fifth higher than early 2020 when the pandemic hit.

Wales, south-west England and East Anglia saw the highest rates of growth, while London - at 7% - had the lowest rate.

"A combination of robust demand and limited stock of homes on the market has kept upward pressure on prices," said Robert Gardner, Nationwide's chief economist.

The UK labour market is strong - job vacancies hit a record high in October last year - and unemployment has continued to fall, which may have helped the housing market, he said.

In addition, some people built up "significant savings" during lockdowns, which is "likely to have helped prospective homebuyers raise a deposit".

Despite these factors, Nationwide expects house price growth to slow in the year ahead, due to high inflation rates and interest rate rises.

The Office for Budget Responsibility (OBR), an independent body that makes economic forecasts for the government, predicted in October last year that house prices would fall in 2022.

It said last week that people in the UK were facing the biggest drop in living standards on record as wages fail to keep pace with rising prices.

Many people took stock of how they lived and worked during Covid lockdowns, leading to a race for space among buyers that was fuelled by a stamp duty holiday.

In recent months, there has been a shortage of homes on the market to match demand, which has pushed up asking prices.

Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said that the housing market was going from "strength to strength" but that March "probably marks the peak for house price growth".

"For starters, mortgage rates look set to rise further in the coming months," she said.

"In addition, we expect housing demand to be hit by a sharp drop in households' real disposable incomes."

The Nationwide's figures came as the Office for National Statistics (ONS) revised up its UK economic growth estimate for the October to December period last year.

It estimated that gross domestic product (GDP) grew by 1.3% in the quarter, as opposed to its previous estimate of a 1% increase.

As a result, the ONS said the level of GDP was now 0.1% below the pre-Covid period of the final quarter of 2019, compared with its previous estimate of 0.4% below.

The ONS figures also indicated that pressures on household finances were leading people to dip into their savings.

The household savings ratio dropped to 6.8% in the October-to-December period, down from 7.5% in the previous three months.

"Savings were at their lowest level since the start of the pandemic as household spending rose, mainly driven by rising prices," said Darren Morgan, ONS director of economic statistics.

Source BBC News