A large number of sellers entering the market in March hit house prices hard, with the average value of property rising just 0.1%, Rightmove has said.
The housing website claimed that the £216 rise, the lowest it has ever recorded for the month, was down to a large number of people putting their home up for sale, with the heightened competition limiting the ability to increase asking prices.
The number of properties on the market jumped by 17.5% compared with the previous month and 34% compared with the same period in 2009 to stand at its highest level for 18 months for the four weeks to March 6.
The rise in sellers, which is in line with figures recently reported by the Royal Institution of Chartered Surveyors, is likely to reduce the current upward pressure on house prices.
Miles Shipside, commercial director of Rightmove, said: “The majority of property price indices will show some further rises this spring, as they reflect the recovery from the weather-induced dampener on turn-of-the-year sales and subsequent mortgage activity.”
Howard Archer, chief UK and European economist IHS Global Insight, said: “If the increase in the supply of properties for sale persists over the coming months, it will cause a recent major prop of house prices to crumble and increase significantly the likelihood that prices will suffer a significant correction.”