British house prices fell 0.5% on the month in February, mortgage lender Halifax said today. It said the annual rate of increase slowed to its weakest in three years.
A 0.5% fall in February followed a 0.8% gain in January and left the annual rate of increase at 12.1% in the three months to February, down from 13.7% in the prior period. That was the slowest pace since December 2001.
Halifax said estate agents were reporting signs that the housing market was stabilising and rising employment continued to underpin prices. 'This continues the mixed pattern of monthly price rises and falls recorded since last summer and is consistent with a gradual slowdown in house price inflation,' it said.
The UK's largest mortgage lender said the average price of a British home was a seasonally-adjusted £162,816 sterling in February down from £163,748 in January.
The Halifax figures contrast with a survey from Nationwide building society earlier this week, which said house prices rose a seasonally adjusted 0.5% in February although the annual rate, at 10.2%, was the lowest since June 2001.
Halifax said recent signs of a robust housing market could - as many economists are now predicting - prompt another rate hike from the Bank of England beyond 4.75%, where they have held for six months.
But it predicted a continuing slowdown in the housing market and consumer spending which could 'be sufficient to avert another increase in rates and provide scope for the Bank of England to cut rates later in the year.'
