The latest house price index from the Nationwide Building Society has revealed prices rose by 0.4% in October on a monthly basis.
On an annual basis, house prices are now 0.8% higher than this time last year – representing the first yearly rise in six months – with the average UK home costing £165,650.
However, when comparing prices in the three months to the end of October with the previous quarter (which is a more reliable indicator), prices fell by 0.2%.
According to the Nationwide, today’s figures suggest the housing market is still “treading water”.
Nationwide’s chief economist, Robert Gardner, comments: “The outlook remains uncertain, but with the UK economic recovery expected to remain sluggish, house price growth is likely to remain soft in the period ahead, with prices moving sideways or drifting modestly lower over the next 12 months.”
In other housing market news this week, property website Hometrack said weak demand drove house prices down 0.2% last month and warned of a downward trend in house prices in the coming months.
Also this week, the Bank of England revealed mortgage approvals fell in September for the first time in six months.
According to the Bank, there were 50,967 loans approved in the month – down 3% on August’s figure.
However, September’s figure was broadly in line with forecasts and suggests the UK mortgage market will remain subdued for some time to come.
Approvals still remain well below levels seen prior to the financial crisis.
Since the early 1990s, mortgage approvals have averaged around 90,000 a month but the credit crunch saw a tightening of lending criteria and many have been unable to secure a mortgage unless they have a significant deposit.
Meanwhile, HM Revenue & Customs (HMRC) revealed a fall in the number of homes sold in September in the UK.
According to HMRC, 72,000 homes worth at least £40,000 or more were sold in the month – the second consecutive monthly decline and way below the July peak of 83,000.
At the height of the housing boom in July 2007, 151,000 homes were sold.