The price of UK homes went up last month marking the second rise in the last two quarters.
Nationwide has revealed that December house prices increased but a small drop may occur in the future.
House prices rose slightly by 0.4% in December leaving them marginally higher than the figures from the start of last year, according to a Nationwide survey.
The average British home is now worth £163,000 but experts are warning that last month’s small rise is not an indication that the value of UK property will stay on the upturn.
Nationwide chief economist Martin Gahbauer said: “Despite December’s increase, house prices have fallen in four out of the last six months and it would be premature to suggest that the recent downward trend has been broken on the basis of one month’s figures”.
“However, the December figures do underscore the fact the current downtrend is only very modest, particularly when seen in comparison to the second half of 2008” he added.
One of the main reasons for the failure of a significant rise in the value of houses in 2010 was the fact that sellers were outnumbering buyers. Teamed with the reluctance of banks to lend to first-time buyers with low initial deposits, house prices fell as competition within the ailing housing market decreased.
Mr Gahbauer said: “There is little to indicate that buyer demand is set to pick up materially from current levels”.
He added: “On balance, a relatively stable picture, with the possibility of a small price decline, appears the most likely outcome for 2011 at this stage”.