April showers hope on housing market as prices stay unchanged

The stabilisation followed eight consecutive months of price falls, which have left the average home in England and Wales costing £153,100, according to property intelligence group Hometrack.

But the group warned that it expects prices to come under further pressure during the second half of the year as consumer confidence weakens.

The number of people looking to buy a home has increased by 22 per cent during the first four months of the year, while agreed sales have soared by 46 per cent.

However, Hometrack warned that the bounce-back in buyer interest was largely due to pent up demand feeding back into the market, following the weak second half of 2010, when many potential househunters sat on their hands.

It said this increase in demand was unlikely to be sustained over the rest of the year, as consumer confidence weakened, Government spending cuts kicked in and household incomes remained under pressure.

At the same time, new properties are continuing to come on to the market at a faster rate than potential buyers are registering with estate agents, creating a mismatch between supply and demand, which will put house prices under renewed downward pressure.

The group also pointed out that the market in London remained far stronger than across the rest of England and Wales, with property prices in the capital rising by 0.3 per cent during April.

But all other regions recorded price falls for the month, with the North East seeing the biggest slide at 0.4 per cent, while prices dropped by 0.3 per cent in Wales and the East Midlands.

Across England and Wales as a whole, prices increased in just 7.7 per cent of postcodes.