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• House prices rose by 0.9%, according to Nationwide
• Increase follows 16 months of continuous decline
House prices increased by 0.9% in March, slowing the annual rate of decline to 15.7%, figures from the Nationwide building society showed today.
The society's monthly snapshot of the market showed the average price of a property in the UK increased by more than £3,000 to £150,946.
The rise follows 16 months of falls and reverses some of the 1.9% drop recorded in February, but the society said it was too early to talk of house price recovery.
The society's chief economist, Fionnuala Earley, said: "The moderation in the annual rate of fall is somewhat distorted by conditions last year, and so it would be unwise to draw strong conclusions from the significant slowdown in the annual rate of fall.
"Equally, while the rise in prices in March is welcome, it is far too soon to see this as evidence that the trough of the market has been reached."
Rival lender the Halifax surprised commentators when it reported a 1.9% increase in prices in January, but this was more than offset by a fall in February. However, this week the Bank of England said the number of loans taken out by homebuyers had risen by 19% in February, with 37,937 loans approved during the month, leading to suggestions that activity in the market may have bottomed out.
But Earley cautioned against reading too much into the upturn in approvals. "The current upturn in activity is more likely to reflect the return of buyers who have delayed purchasing through the worst of the financial turbulence at the end of 2008 rather than the beginnings of a swift recovery," she said.
"Nevertheless, the willingness of borrowers to return to the market is encouraging".
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