House prices have declined by 0.2% in January, according to a major building society.

According to the figures released on Wednesday, Nationwide said that although property prices are down on the month, they are still 0.6% higher than one year ago, with the price of a typical home now £162,228.

Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said that given the challenging conditions in late 2011, with the UK economy contracting in the final three months of the year, it was not surprising house price growth softened at the start of 2012.


Mr Gardner said: "The demand/supply balance may move further in favour of buyers in the months ahead. The economy is not expected to gather much momentum until the second half of 2012 at the earliest, which suggests that labour market conditions and buyer sentiment may be slow to improve.

"Nevertheless, with the flow of properties coming onto the market still more of a trickle than a flood, house prices are likely to continue to move sideways or only modestly lower in the months ahead."

(DW/GK)