UK house prices fell back in July, for the first time since February, as buyer demand remained weak.
According to Nationwide, the average value of a home declined by 0.5%, to £169,347, taking the annual rate of inflation down to 6.6%, compared with 8.7% in June.
The lender notes that the sizeable drop is due in part to the strength of house price gains in July of last year.
Demand from homebuyers remained subdued, attributes this to a combination of restrictive credit conditions and nervousness on the part of potential first-time buyers and home movers, who are uncertain about the future economic outlook.
At the same time, the imbalance between supply and demand has been easing since the abolition of Home Information Packs in May, putting further downward pressure on prices.
It will take several more months to establish whether house prices are now simply oscillating around a flat price trend or whether a period of downward trending prices may be in store!