The staggering rise in the value of the London housing market is one reason to be cautious about greeting the more modest increase in Scottish house prices.

The rise north of the Border is significant. At 7.6% up on a year ago, the change is substantially higher than in Northern Ireland and Wales, and is part of the strongest pattern of growth for six years.

However, the biggest rises were seen in London, where they soared a further 18.2% last year, and in parts of the south-east, with some areas surpassing levels before the financial crisis.

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In Scotland, prices have risen more strongly than at any time since 2007. While the property market can sometimes be a good measure of economic strength, there are danger signs, too, in the latest figures from building society Nationwide. They show the gap between house prices in London and those in the rest of the UK is as wide as it has ever been.

With prices rising at three times the rate of inflation in Scotland, the housing market's link to wider prosperity appears tenuous. In fact, with many people experiencing pay freezes or real-terms pay cuts, there is not only a gulf emerging between London and the rest of the UK, but within local markets too.

The gulf between those who can afford to enter the housing market and those who cannot is growing rapidly. Large numbers of young adults cannot afford to join the property ladder, breeding frustration and stalling life opportunities such as starting a family.

George Osborne has pinned his hopes of economic recovery on the housing market with measures such as the Help to Buy loan scheme. Unless other sectors are also healthy, house prices can also be an unreliable indicator. A London-led property bubble runs the risk of repeating past mistakes, which helped lead us into the financial crisis, rather than driving true recovery.

The impact of schemes such as Help to Buy is arguably counterproductive and may be feeding the London property bubble.

By offering help to buy houses of up to £600,000 in particular, it is clearly offering help to the already relatively wealthy and the Chancellor should heed warnings to lower the limit on the scheme.

The other significance in the figures is that they reflect the ongoing underprovision of housing in the UK in general. In Scotland, current levels of building fall well short of the 10,000 affordable homes a year needed to meet housing need, according to charities such as Shelter. Building in other parts of the UK is also lagging well behind demand.

Rising property prices are to be welcomed but only if they are stable and sustainable. Governments should promote this and help avoid rapid and destabilising inflationary trends in the housing market.

The Coalition Government has chosen a different path, encouraging borrowing and higher prices, and may feel signs of economic recovery justify this. While any true economic recovery is welcome, these figures are concerning and indicate that Mr Osborne's policy should be rethought.