The mortgage lender echoes the findings of rival Nationwide Building Society, which recorded a drop of 1% in February.

Halifax said this is the first fall in property prices in seven months, leaving the typical property value at £166,587. However, the underlying resilience of the UK property market means that the annual figure for house price growth still stands at 4.5%, compared to the annual fall of 17.7% recorded last February.

The lender attributes the slowdown to a fall in activity in the first two months of the year, following the unusual spike in property purchase towards the end of the year which was driven by a stampede of buyers rushing to secure a home before the Stamp Duty holiday ended on 31st December.

It also points to the arctic conditions effectively freezing the market for a number of weeks.

Halifax’s chief economist Martin Ellis said: “An increase in the number of properties available for sale has helped to reduce slightly the imbalance between supply and demand. At the same time, the bad weather in the first two months of 2010, together with the return of the lowest Stamp Duty threshold to £175,000, are likely to have had an adverse impact on housing demand. The combination of these factors appears to have helped to curb the upward pressure on house prices.”

However, the lender pointedly failed to comment on what it believes the latest figures mean for the future of UK house prices. Opinion is divided, with the Centre for Economic Business Research forecasting a 6% rise this year, while Capital Economics says values will decline by 10%. Nationwide and Halifax have not made official predictions, but are understood to hold the view that property values will not change dramatically this year.