House prices dropped by 0.6% in August, Nationwide has reported.
The lender said house prices now stand at an average of £165,914, a drop of 0.4% over the year.
Nationwide said it expects to see the sluggish market continue.
Robert Gardner, Nationwide’s chief economist, said: “UK house prices declined by 0.6% in August, although this doesn’t change the picture of relative stability that has characterised the market over the past twelve months. Indeed, prices were broadly unchanged compared with August 2010 – just 0.4% lower.
“Sluggish demand for homes, combined with only a gradual rise in the supply of available properties, has helped to keep property prices stable since last summer.
“We expect this trend to be maintained over the remainder of 2011, although downside risks have increased as UK and global growth prospects have weakened.”
Nationwide’s data is based on a sample size of around 4,000 housing transactions. The lender has a market share of about 9%, leading some critics to say that the data does not paint a big enough picture.
However, its house price findings are broadly, and consistently, in line with Halifax and the Land Registry.
Meanwhile, according to boards firm Agency Express, the UK housing market showed signs of life in August.
The firm said it found property activity across the UK for the month surprisingly resilient, with For Sale signs converting to Sold up 3.9% on July. The number of new ‘For Sale’ listings in August was down 1.3% on July as seasonally expected.
However, it said the overall number of properties going over to ‘Sold’ signs was 5.3% down on August 2010 figures.
