Asking prices for properties new to the market have risen by almost £10,000 in the last month, driven by London where asking prices have shot up an extraordinary £4,405 per week so far this year.

The Bank of England said it is ready to step in, with governor Mark Carney saying he will intervene on mortgages if it is thought necessary. Mortgage ratios to salaries could be capped, and Carney also said that the Bank is monitoring the Help to Buy scheme.

Rightmove said this morning that the 3.6% increase – equivalent to £9,409 – was the largest rise ever in May.

The average asking price in England and Wales is now £272,003 – a new record high.

It means that the average price of a property coming to the market is now 8.9% higher than a year ago, and is the highest annual rate of inflation since October 2007 when it was 10.4%.

In London, the annual rise in asking prices is 16.3% – which Rightmove described as “frothy”.

In parts of London, the annual rise is more than this – for example, in Tower Hamlets, new asking prices are 43.1% higher than a year ago, and in ten boroughs the annual rises are over 20%.

One agent, Ben Butler of Morgan Randall in Canary Wharf, which is in Tower Hamlets, said: “One property sold in December for £425,000 and in March an identical property in the same building sold for £575,000 – a £150,000 difference in just a few months.”

However, it is London that is distorting the 10.4% annual increase across the country. Removing London from the equation, the rise is 4.9%.

The disparity between London and the rest of the country is also highlighted by the pattern of increases so far this year: the average asking price in London is up by nearly £80,000 so far in 2014 (£4,405 per week) but by £1,521 elsewhere.

While all regions have shown annual rises in new asking prices, in the north the change is just 0.1% and in the west midlands it is 2.8%.

Across all regions of Britain outside the south and East Anglia, asking prices are still below their previous peaks.

Rightmove says that buyer demand is very strong, with email inquiries sent to its agents up by nearly 20% compared with a year ago.

Seller activity has, by comparison, dipped slightly, with the number of properties coming to the market down by 1% compared with April.

The average estate agent has 62 properties on its books, says Rightmove, and time on market is around 75 days.