Halifax has reported home prices took a small dip during the month of August.  The modest 1.2% fall ended a streak of three straight months of increasing home prices.  The average price of a home now in the UK sits at 161,743 pounds.  In comparison to the same time last year, prices have now fallen almost 3% in twelve months.

Halifax economist Martin Ellis believes home prices and activity within the housing market will remain stable in the coming months.  Howard Archer, IHS Global Insight, is of another opinion.  He thinks the drop is a precursor of things to come in the market. 

Archer commented on the market in general, saying: "We continue to believe that house prices are likely to fall by around 5% overall from current levels by mid-2012 in the face of persistent troublesome economic fundamentals.  And the current sell-offs in financial markets and heightened concerns over the global economy are unlikely to do much for consumer confidence and willingness to commit to buying a house in the near term.

"We suspect that squeezed purchasing power, tightening fiscal policy, a softening labour market and persistent serious concerns over the economic outlook will limit potential buyers and weigh down on house prices."

Activity remains low within the market, as approvals for mortgage loans are well behind the pace of pre-crisis days numbering in the 80 to 90,000’s.

Archer commented further on the state of the market, saying: "A level of 70,000-80,000 has in the past been considered consistent with stable house prices."