Although growth over the year has averaged out positively, the 1.7% increase is 9.7% lower than April 2007’s annual increase of 11.4%. The Assetz house price index – which takes into account five major UK house price indices including those from Nationwide and Halifax – also recorded a monthly decrease of £915 in average house prices during April.

Online property portal Rightmove’s house price index, on the other hand, recorded a 1.2% increase in the average property’s asking price during May, bringing it up to £242,500. According to Rightmove, however, “discretionary spring sellers” of larger homes in the South have pushed up asking prices and as a result, masked year-on-year falls in six out of 10 regions across the UK.

Stuart Law, chief executive of Assetz, said: “While house prices fell by 0.6% in April, prices remain up on the previous year and I am yet to see any firm evidence of a housing market crash. We saw a steep increase in house prices leading up to a peak in October last year.

“This was widely regarded as an unsustainable level of growth and we are currently embedded in a period of stabilisation, throughout which house prices in this country have remained extremely robust in spite of the difficulties in the mortgage market.”

Law added that the excess demand for housing is currently directed at the buy-to-let sector. This, he said, has caused rents to soar, rather than house prices, as difficulties in the mortgage market persist. “As a result, rents are rising at historically high levels, providing excellent returns for buy-to-let investors,” Law said.

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