In spite of last months surprising increase in average house prices, February has seen a return to the expected fall of prices.

Nationwide's house price survey shows a drop of 1.8% in February, meaning a 17.6% drop in the last 12 months and a giant 20.6% from their peak in October 2007.

The Nationwide figures for actual average price differ to that of Halifax, although both show a similar pattern. Nationwide are now showing the average house price in the UK at below £150,000, which is similar to levels of May 2004.

It seems that the increase in buyer enquiries in estate agents, possibly due to lower mortgage loan rates and house prices, isn't leading to increased purchases as buyers continue to hold off with expectations of further falls.

As our latest article shows, similar banking crises in the past have resulted in house prices dropping on average 35% from peak to trough during the crisis, which leaves scope for another 10% or so.