The annual rate of house price growth has stayed at 2.1% for the third month running, according to the latest Halifax House Price Index.

This has taken the average price of a UK property to £285,476, which compares to £282,360 in January.

When compared to January, there was a 1.1% increase in house prices through the month of February, although Halifax stated that overall prices are flat compared to three months ago.

Director at Halifax Mortgages, Kim Kinnaird, said that recent reductions in mortgage rates, improving consumer confidence, and a continuing resilience in the labour market are “helping to stabilise prices”, following falls seen in November and December.

However, the Halifax data did also show that house prices fell on a quarterly basis by 2.5%.

“With the cost of a home down on a quarterly basis, the underlying activity continues to indicate a general downward trend,” Kinnaird said.

“In cash terms, house prices are down around £8,500 (-2.9%) on the August 2022 peak but remain almost £9,000 above the average prices seen at the start of 2022 and are still above pre-pandemic levels, meaning most sellers will retain price gains made during the pandemic. With average house prices remaining high, housing affordability will continue to feel challenging for many buyers.”

Halifax’s latest index also indicated that the rate of annual growth slowed in all nations and regions across the UK in February.

Annual growth reduced most significantly in the North East, at 1.1% in February compared to a rise of 3.6% in January, with homes now costing an average £163,953.

Average house prices in London are now £526,842, which is a 0.9% drop from January’s £530,416. Halifax suggested that London may be affected by its large proportion of flats – prices for which have broadly stagnated – although despite this slowdown, homes in the capital still cost over £240,000 more than the UK national average.

Annual growth fell the least in Scotland, where the average house price is now £198,779, a growth rate of 2.2% compared to 2.3% in January. Similarly in Wales, annual growth in February was 1.2%, compared to 1.9% in January, with homes currently costing an average £210,917.

In Northern Ireland, those purchasing the average priced home will now pay £185,009, which reflects an annual growth rate of 5.7%, down 7.0% in January.

Head of personal finance at Hargreaves Lansdown, Sarah Coles, added: “When you drill further into the figures, it’s clear certain parts of the market are pushing the average up, and some are looking pretty miserable. Looking at flats alone, prices are down over the year.

“Meanwhile, when you remove new builds from the equation, overall prices are up around 1% – the smallest rise in almost a decade. Falling or stagnant prices could persuade buyers that a wait-and-see strategy is still worth pursuing.

“The resilience of prices in some corners of the market so far could actually work against sellers, especially now that mortgage rates are higher. A combination of the two – plus higher overall prices feeding into affordability calculations – means that even if buyers are still keen to move, their mortgage company may have other ideas.”

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