British house prices logged an unexpected decline in February, offsetting the increase in the prior month, data from the Lloyds Banking Group's Halifax division showed Tuesday.
House prices were down 0.5 percent in February from a month ago, Halifax said. Economists had expected a 0.3 percent rise for February.
The decline in February followed 0.6 percent increase in January, mirroring the mixed monthly pattern seen over the past year.
House prices in the three months to February were 1.9 percent lower than in the same period a year earlier. The decline exceeded an expected 1.6 percent drop.
For three months to February, prices dipped 1.1 percent from the previous three months. In February, the proportion of house purchasers who are first-time buyers increased for the second successive month.
The finding of Halifax's February survey was in contrast to the 0.6 percent rise reported by Nationwide Building Society. The Nationwide report showed that house prices increased in February due to a rush from buyers to avail the stamp duty exemption.
Moreover, mortgage approvals rose to a two-year high in January, according to the Bank of England.
"Overall, prices nationally are at broadly the same level as last spring," Martin Ellis, Halifax housing economist said. This stability in prices reflects the fact that market conditions have changed very little over this period with demand supported by low interest rates and supply remaining tight.
The economist said the prospects for house prices this year, to a large extent depend on events in the Eurozone and the potential knock-on effects on the U.K.
Although the economy looks like it is returning to growth in the first quarter, the economic fundamentals still look far from rosy for the housing market with high unemployment, muted wage growth and the uncertain outlook, IHS Global Insight's chief UK economist Howard Archer noted.
The Bank of England is expected to leave its key rate unchanged at a historic low of 0.5 percent on March 8. The bank is also set to maintain its quantitative easing unchanged at GBP 325 billion after lifting it in February.
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