Two sets of statistics published this week give contrasting views of the state of the British housing market.

Hometrack, the housing research company, announced that house prices in January rose 0.1%.

It said the growth was driven by London, where a shortfall in supply coupled with an increase in demand led to a 0.2% rise.

However, the picture in the UK showed that average house prices were unchanged in 85% of the country last month, with 9% of areas registering price rises and 6% falls. The main areas of inflation were Exeter, Salisbury, Oxford and Brighton.

Research director Richard Donnell said: "Activity levels held up quite strongly over the final weeks of 2005 compared with previous years. The key question is whether momentum from late 2005 will revive over the next few weeks."

A more optimistic picture was painted by the Nationwide. It found that the average price of a home rose by 1.4% in January to £158,478. This is the biggest monthly increase since July 2004, the peak of the recent boom.