By Marcus Leach

Figures for September from Nationwide have revealed that house prices are 'treading water' as they rose by just 0.1% from August.

The rise left the average price of a home 0.3% lower than a year earlier, at £166,256, the building society said.

Nationwide cited the eurozone debt crisis, which has caused a dip in confidence among buyers, as the main reason for the figures.

"Sentiment towards major purchases is depressed, as a result of weak labour market conditions and ongoing pressure on household budgets from above-target inflation," said Robert Gardner, Nationwide's chief economist.

“Sluggish demand for homes on the back of weak labour market conditions, combined with only a gradual rise in the supply of available properties, has helped to keep property prices fairly stable since the summer of 2010. We expect this trend to be maintained over the remainder of 2011, although downside risks have increased as UK and global growth prospects have weakened."

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