House prices dipped in February, according to the latest survey figures from Nationwide.

The average price of UK houses fell by 0.2% in February and the average house price in the UK is now £158,578.

But over the last six months the building society said growth in house prices has still been strong, and that the prices were still 3.7% higher than they were this time last year.

It claimed that these long term price rises made interest rate cuts less likely in the short term.

However Greg Fuzesi, Nationwide’s Senior Economist, warned home owners that there could be tough times ahead.

He said: “As we enter the all-important house buying season in March, the prospects for both house prices and interest rate policy will become clearer. It will also show whether February’s fall is just a pause before the spring rush or the first sign of weak market fundamentals weighing down on prices.

“We expect the weaker economic factors to begin to dominate over the next 2-3 months and to prevent strong house price rises in 2006.”

And he argued that the housing market was damaged by the fact that many first time buyers were still being priced out of the market.