UK house prices fell in February for the first time in nine months but annual house price inflation remained steady, according to figures from Nationwide.
The society's monthly house price index shows house prices dropped by 0.8 per cent to an average of £83,314 in February from £83,450 in January.
But house prices were up by 8.1 per cent on the same time last year when they stood at £77,072, which Nationwide says is a more sustainable level of growth than last April's high of 17.5 per cent.
The society attributes the monthly drop in prices to the house market in London running out of steam and a falloff in activity in parts of Wales and Scotland. Despite the downturn, Nationwide remains optimistic about the rest of the year, pointing to high consumer confidence, low unemployment and a strong demand for new property as reasons for optimism.
The society also welcomed the cut in interest rates as a timely boost to the market.
Divisional director (planning) David Parry says: “The Bank of England's decision to cut base rates by a quarter of a point in February should provide a welcome tonic to homebuyers.
“As well as the savings in monthly mortgage payments, the low interest rate environment will do much to maintain confidence among those contemplating moving.”