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The annual rate of house price growth is continuing to slow, according to the UK's biggest mortgage lender, the Halifax.

In the year to May house price inflation fell to 3.3%, down from 3.8% in the year to April.

Over the last three months there has been virtually no change in prices, the Halifax said.

Since March property prices have fallen by 0.2%. This was only the second quarterly drop since November 2012.

However between April and May, prices actually rose by 0.4%.

That is in contrast to recent figures from rival lender Nationwide, which said that prices had fallen every month since March.

Supply

The average cost of a house or flat in the UK is now £220,706, according to the Halifax research.

Martin Ellis, Halifax housing economist, said the shortage of property on the market was likely to keep prices buoyant over the rest of the summer.

"The fact that the supply of new homes and existing properties available for sale remains low, combined with historically low mortgage rates and a high employment rate, is likely to support house price levels over the coming months."

However Howard Archer, chief economic adviser to the EY ITEM Club, said prices were likely to come under further pressure.

"The fundamentals for house buyers are likely to deteriorate further over the coming months with consumers' purchasing power squeezed further by a combination of higher inflation and muted earnings growth," he said.

"It is also possible that the labour market could increasingly falter despite its current resilience."

The Halifax said housing supply remained very low, with the number of properties coming onto the market falling for 14 months in a row.

However it noted there had been a rise in private sector house-building at the start of 2017.

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