The housing market is confounding expectations by growing steadily, the country's leading building society said on Tuesday.

The Nationwide said property prices rose by 0.5 per cent in February as annual house price inflation eased to 10.2 per cent.

Homeowners now expect house prices to rise by 1 per cent over the next six months, the building society said.

Alex Bannister, Nationwide's group economist, said: "The price of the typical house increased by 0.5 per cent in February.

"This followed January's 0.4 per cent increase in prices and extends the period over which the trend has been for relatively subdued but steady price growth to seven months." The price of the typical property now stands at £152,879 - just over £14,000 or 10.2 per cent higher than in February last year.

Housing market activity, which had been slowing in the second half of last year, appears to have bottomed out, the Nationwide reported.

Mr Bannister said: "We expect that the number of house purchase mortgages approved in February will recover to at least 80,000 from the decade-low approvals seen in January."