House prices in Britain rose slightly last month.
Home owners are reluctant to place their property on the market while prices remain low.
UK house prices increased by 0.8% in January. However, the figures were still 2.4% lower than the same period last year, according to the Halifax.
The statistics revealed by the Lloyds Banking Group lender highlight that the average price of a British home now stands at £164,173.
Halifax’s housing economist Martin Ellis said: “We expect limited movement in house prices overall this year. There are, however, likely to be some monthly fluctuations with the risks on the downside”.
He continued: “The prospects for the market in 2011 are closely aligned with the performance of the wider economy. Consumer confidence has fallen recently, partly as a result of nervousness about the economic outlook”.
Despite the increase at the start of this year, prices in the three months to the end of January were still 0.7% lower than the previous three months. Teamed with low interest rates, this steady overall decline has meant that fewer home owners have placed their houses on the property market – they hope to secure a more favourable price on their homes in the future once the economy begins to improve.
Mr Ellis said: “This development should help to relieve downward pressures on prices as long as it is sustained. We also expect interest rates to remain very low for some time, supporting a favourable affordability position for many existing mortgage borrowers and those entering the market”.
