Property prices in March were 2.9% lower than a year ago, with the average UK house price standing at £162,912.
However, the number of mortgages approved for house purchases rose 2% to 47,000 over January and February from the December low, but remain 60% down on pre-credit crunch levels four years ago at 116,700.
However, the Budget is likely to have a stabilising influence on the housing market, said Halifax.
“If the proposed measures are successful, they should increase the supply of new homes and boost the number of properties for rent, helping to reduce the size of swings in house price movements over the cycle.”
The announced launch of the new shared equity scheme, FirstBuy, is likely to increase the flow of first-time buyers into the market, although the scheme’s impact is limited as it aims to help just 10,000, which is just 5% of the total number of first-time buyers in 2010.
Today, the top Stamp Duty threshold rate has changed from 4% to 5% on properties worth over £1m. The increase will add £10,000 to the total Stamp Duty bill of a £1m home.
Meanwhile, the number of employed people increased by 32,000 in the quarter to January, although part-time employment fell by 43,000, with total employment up 296,000 over the past year.
Martin Ellis, Halifax housing economist, said: “Our forecast remains for a 2% decrease in house prices in 2011 as a whole. Uncertainty over the general economic outlook and individual financial circumstances are likely to constrain housing demand, resulting in some modest downward pressure on prices.”