HOUSE prices crept up last month in spite of predictions the economic storm clouds would force sellers to accept lower offers, the Nationwide building society said today.
Meanwhile, figures from the Bank of England showed a modest pick-up in the amount of unsecured lending to consumers and a sizeable pick-up in mortgage lending.
However, economists cautioned that both surveys remained extremely downbeat with the underlying theme on the economy remaining one of caution.
Nationwide said house prices edged 0.1% higher in September after falling 0.6% in August. Many economists had expected another decline, but taken against a year ago, house prices are still down 0.3%.
Robert Gardner, chief economist of the building society, said: "UK house prices continued to tread water in September. 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."
Howard Archer, economist at IHS Global Insight, said the figures merely underlined his forecasts that house prices would trend downwards gradually.
He added that the Bank of England data, which showed mortgage lending at a 32-month high in August, was still way below the long-term norm.
Unsecured consumer credit picked up to £459 billion in August from July's six-month low of £293 billion but is still historically low. People paid back a net £23 million on their credit cards - the first time card debt has been reduced across the country since April 2010.
Analysts said the muted credit numbers reflected a nation nervous about taking on new debt at a time when their job and financial prospects were shaky.
Troubled economic times tend to see people fight to cut their debts.
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Archer pointed out that the fact that August's overall consumer credit rose could be due to the rising inflation of goods in the shops and low
wage growth.
City economists are generally predicting a modest fall in house prices of about 5% over the course of the next year, although some are revising their forecasts downwards in the light of the growing economic problems.
