The Halifax house price index showed the price of the typical home across the UK dipped by 0.4 per cent in October - a move which caught some analysts on the hop.
And while prices in the three months to October were 0.8 per cent higher than in the preceding three months, this was the third consecutive decline in the quarterly rate of increase and the smallest quarterly rise since December 2012.
Annual price growth in the three months to October slowed to 8.8 per cent from 9.6 per cent in September.
"Activity continues to decline with mortgage approvals in September falling for the third successive month to a 14 month low, whilst home sales are at their lowest level since October 2013. The associated weakening in demand has brought supply and demand into better balance" says Martin Ellis, Halifax's senior economist.
While the chances of an imminent interest rate hike may have receded, a recent Halifax survey found that many borrowers are concerned about the impact a rise could have on their monthly mortgage repayments over the next 12 months. This concern is likely to curb buying intentions" he warns.
Halifax says three other key housing indicators should be taken into account by market observers
Firstly, HMRC says home sales contracted for the seventh month in succession, falling to 97,450 in September - the lowest level since October 2013 (95,640). Sales in September were 11% below their recent in peak in February 2014 (109,530).
Secondly, the Bank of England shows that mortgage approvals at a 14 month low. The volume of mortgage approvals for house purchases - a leading indicator of completed house sales - fell for the third consecutive month in September, to 61,300. Approvals have now fallen by 20 per cent from 76,500 in January 2014.
Thirdly, there are signs of an improved balance between supply and demand according to data from RICS. Market conditions, as measured by the ratio of house sales to the stock of unsold properties - reported by the Royal Institution of Chartered Surveyors' monthly survey - eased for the second consecutive month in September as a result of lower sales, according to the latest data. This suggests that a better balance between supply and demand may be emerging.
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