Housing inflation escalated sharply over the past 11 months and is set to reach an ominous 13 per cent by the end of the year, data released yesterday has found.

Prices climbed by 11.9 per cent from January to November - more than twice the rate of increase recorded for the same period in 2001, the Permanent TSB House Price Index reveals.

The average cost of a home in November was €203,407 compared to €183,253 in 2001. Dublin prices continued to run ahead of the rest of the country.

The average cost of a new house in the capital was €267,000 compared to €178,654 elsewhere. The equivalents for November 2001 were €238,696 and €161,285.

Inflation for the full year could be as high as 13 per cent, although it is probable the rate of increase would moderate as new houses come on stream and the economy continues to cool, Permanent TSB said. It was too early to ascertain the impact of the recent Budget on the market, said Mr Niall O'Grady, general manager of Permanent-TSB.

Housing inflation stood at 1.4 per cent last month, resulting in a 5.5 per cent cumulative growth since August, according to the data, compiled in association with the Economic and Social Research Institute.

The price paid by first- and second-time buyers averaged at €177,502 and €229,430, compared to €162,459 and €205,771 for November 2001. The rate of growth in prices paid by new and second-hand buyers were 10.9 per cent and 11.8 per cent respectively.

Second-hand houses recorded the highest rate of increase at 1.7 per cent while the price of new house actually fell 0.1 per cent last month, the figures show.

Year on year, growth in new and second-hand residences were 6.3 per cent and 15 per cent respectively.

The average paid for new and second-hand homes in November were €200,391 and €208,467.

Last year's equivalents were €189,309 and €183,845.

Opposition politicians seized on the new figures, claiming Government attempts to keep housing inflation in check had failed.

Rising prices were a "damning indictment" of Government policy said the Labour Party's environment spokesman, Mr Eamon Gilmore, and was a further blow to home buyers in the wake of the Budget.