Property data from the Office for National Statistics showed property prices grew by an average of 8.4% in the year to January.

This was down from the 9.8% recorded a month earlier and Brian Murphy, head of lending at Mortgage Advice Bureau, said the market was levelling off.

“The slowest rate of annual house price growth since March last year will be a relief to anyone concerned that the property market had taken leave of its senses,” he said.

“Measures to boost mortgage affordability checks have helped to instil a sense of calm and mean the pace of growth in house prices is looking far more sensible than a year ago.”

Annual house price growth was 8.5% in England, 7.8% in Scotland, 4.9% in Wales and 7.3% in Northern Ireland.

In England the highest rises came in London and the surrounding regions. Property prices rose 13% year-on-year in the capital and were also up in the East (9.9%) and the South East (7.6%).

Excluding London and the South East, UK house prices increased by 6.5% in the 12 months to January 2015.

Andy Knee, chief executive of LMS, expected this slowing market to continue for at least a few more months.

“With the inflation rate dropping to zero for the first time on record and house prices rises down from December of last year, we continue to see a cooling in the market prior to the election in May; a pause of uncertainty as consumers wait for an outcome,” he said.

“The market jitters are likely to fade towards the second half of the year, once an elected party is established, bringing with it its own set of agendas and a greater level of certainty.

“While owner-occupiers have seen prices rise, sadly, it is first-time buyers who have seen a sharper rise compared to January of last year, an indication that they are still far off from fulfilling their homeownership dreams; clearly, the cooling has not translated into a healthier first-time buyer market yet and even the Chancellor’s new help to buy ISA will not solve all their problems.”