0.1% rise this month, but quarter-on-quarter growth rate turns negative

House prices remained broadly unchanged during September as activity in the market continued to flag.

The average cost of a home rose by just 0.1% to £166,757 during the month, following a 0.8% slide in August, according to Nationwide. But the quarter-on-quarter growth rate turned negative for the first time since May 2009, with prices falling by 0.9% during the three months to the end of September.

Nationwide said the figure was consistent with the “clear loosening of housing market conditions” over the summer. But it stressed that it did not point to a “significant pace of decline” in property values, while it remained well down on quarterly falls of 5.5% seen during the 2008 housing market correction.

Martin Gahbauer, Nationwide’s chief economist, said the future direction of prices would depend on whether the strong flow of new properties coming on to the market continued into the autumn.