Monthly house prices fell for the first time in February 2010 since April 2009. The Land Registry reported that prices fell 0.3 percent to £164,455 though year on year prices were up by seven percent. The Land Registry  figures are based on completed sales and therefore tend to lag behind figures reported by lenders. Nationwide and Halifax both reported the fall a few days ago and experts now believe that the recovery in house prices may be levelling off. The recovery appears to have been aided by a reduced supply of housing on the market and low mortgage rates.

"We suspect that house prices will be erratic and prone to corrections in 2010, and will probably be no better than flat over the year," said Howard Archer, UK economist for IHS Global Insight.

"The overall appreciable house prices rises that have been seen since early 2009 have been out of kilter with ... economic fundamentals," he added, pointing out that house prices had been rising much faster than earnings.

In his budget, Alistair  Darling announced a moratorium for two years on property purchase taxes for first-time homebuyers up to £250,000. This is expected house prices even though it might not be of much use in London, where the Land Registry reported average house prices of £334,000.

Meanwhile, the FSA found that the default rate for buy-to-let mortgages with LTVs between 90 per cent and 95 per cent was 8.13 per cent compared with a 2.56 per cent default rate for prime loans. This was no surprise to experts who pointed out that buyers with little or negative equity in rented properties would obviously be the first to default.

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