UK house prices fell by 0.9% in December to an average of £160,063, according to the latest house price index from Halifax.
This represents a year-on-year decline of 1.3% and means that prices fell by 0.1% in the three months to December, compared to the previous quarter.
Martin Ellis, housing economist at Halifax, says while there was a modest fall in prices during 2011, overall property values have held up well in the face of a worsening economic climate and considerable pressures on household finances.
He says: “If the UK can avoid recession, we expect broad stability in house prices in 2012. There is, however, considerable uncertainty regarding the prospects for the UK economy which will, to a large extent, depend on how events in the eurozone unfold.
“In addition, the extent to which households choose to reduce their debts will affect growth. As a result, the outlook for house prices is uncertain.”