House prices edged ahead by just 0.1 per cent during January as buyers stayed away from the market, figures showed today.
Property website Hometrack said London was the main driving force behind the rise as the supply of property in the capital failed to keep pace with demand.
But elsewhere in England and Wales prices remained largely unchanged as buyers stayed away from the market during the Christmas and New Year period.
The group said activity levels fell by nearly 14 per cent during January, although it added that it expected them to pick up again over the coming
few months. Overall, house prices remained static in 85 per cent of postcode areas in the wake of the festive season, with just nine per cent reporting rises and six per cent seeing falls. The average property in England and Wales now costs £161,100.
Evidence of a slowdown in the market during January runs counter to reports from property website Rightmove, which said prices had soared by £2,048 during the first week of 2006 - the largest weekly rise since May 2004.
The group attributed the rise to first-time buyers seizing the opportunity to get on to the property ladder during the quiet Christmas period.