House prices fell in July, to an average of £161,094 across the country, after increasing in the previous two months.
Prices fell by 0.6 per cent in July, compared with the previous month, according to the Halifax House Price Index.
Average prices are also 0.6 per cent lower compared with July 2011, the Halifax said.
The bank expects prices to remain at this level for the rest of 2012, unless the UK economy deteriorates further.
Martin Ellis, housing economist for the Halifax, said: “At a national level, house prices have been very stable over the past year or so.
“This can largely be explained by the static nature of supply and demand conditions during this period.”
House prices are now at approximately the same level as in the summer of 2009.
Meanwhile, property search website Rightmove has revealed an ‘opinion gap’ between buyers and sellers over house prices.
In a survey of 40,000 househunters, Rightmove found than nearly half of those planning to buy a house in the next year believe that prices in their area are above a ‘fair and reasonable’ figure.
Sellers seem to disagree, however, with just over a third agreeing that prices are unfairly high.
Miles Shipside, director of Rightmove, said: “Naturally, sellers have an interest in standing their ground in order to achieve the best price but in the current housing market, where sellers outnumber successful buyers by around two to one, sellers need to lower the price or increase the perception of value to avoid being outflanked by their competition.
“First impressions are vital, and if a prospective buyer’s first impression is that a property is over-priced, they may not take their interest any further.”
Only a quarter of those surveyed by Rightmove thought that prices would be lower in 12 months time.
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