House prices increase 0.7% in March

According to the lender, the average UK house price now stands at £164,519, a 9% improvement from March 2009.

Martin Gahbauer, Nationwide's chief economist, said: "The price of a typical UK property rose by a seasonally adjusted 0.7% month-on-month in March, largely reversing the 0.8% fall measured in February. The smoother quarter comparison rate of inflation edged down further from 1.8% in February to 1.6% in March.

"The last two months are consistent with a relatively flat profile for house prices, and in line with the recent drops seen in buyer enquiries and house sales. Preliminary figures show that the number of loans taken out for house purchases failed to recover from January's large dip, suggesting that weakness in house sales at the start of the year may have been due to more than just the snowy weather.

"With greater than usual political and economic uncertainty ahead of the upcoming general election, potential homebuyers are proceeding cautiously. At the same time, the number of homes for sale has not increased appreciably, meaning that the impact of lower buyer activity on house prices has not been too negative. If this trend continues, we are likely to see relatively few properties changing hands, but with prices fairly stable."