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Fears of a double-dip in house prices eased today amid signs the market has stabilised.
Mortgage lender Halifax said the average price of a house in the UK rose 0.6% in July after a 0.6% fall in June.
Prices are now 0.8% down on the start of the year and 16% below their peak in August 2007, but 8.3% higher than their trough in April 2009.
David Smith, senior partner at estate agent Carter Jonas, said: “What we are seeing is a stabilisation in the property market rather than, as some have suggested, the beginnings of a sharp correction.”
Halifax housing economist Martin Ellis said: “The mixed pattern of monthly rises and falls over the first seven months of the year is consistent with a slowing market.”
Halifax expects that house prices will be broadly unchanged across 2010 and said low interest rates and a recovering economy were helping to underpin demand.
Many economists believe the housing market will cool this year as Britain's economy struggles to pull clear of recession, with government spending cuts and massive job losses in the public sector denting demand.
“We still think the overall evidence does point to pretty soft activity - more houses coming on to the market and a softening of prices,” said Howard Archer, economist at IHS Global Insight.
Recent official data has shown mortgage lending remains weak and approvals for home purchase loans - a lead indicator of house prices - have held at low levels.
