UK house prices increased by 0.6% in October, more than offsetting the 0.4% decline recorded the previous month, according to the latest house price index from the Nationwide Building Society.

The average UK house price is now £164,153.

“Monthly price changes have failed to establish a strong trend in either direction over the past six months, with three months of increases and three months of price declines since May 2012,” said Robert Gardner, Nationwide’s chief economist.

“The annual pace of change continues to display a picture of relative stability, with house prices down just 0.9% compared to October 2011. This maintains the pattern that has been evident since late 2010, with annual price growth remaining in a narrow band between +1.5% and -1.5% on all but two occasions over the past two years.”

Donna Houguez, market analyst at Quickmovenow.com, added: “Three months up, three months down says it all. The property market has zero direction and is being skewed by low transaction levels.

“The fact that prices are down over the year paints a far more accurate picture of the market and there is every chance they will continue to fall in 2013.

“Despite the fact that we have technically exited recession, the UK economy, as the Nationwide observes, remains under pressure and this will mean the property market has to fight for any gains.

“It is going to take the gap between real income and house prices to reduce in order for the recent economic growth we’ve seen to translate into an upturn in the housing market.

“High petrol, food and utility prices aren’t helping. They’re sapping people of confidence.

“There are two major factors holding back the property market – the big deposits required by first time buyers and the fact that many sellers are still being totally unrealistic with their asking prices.”