The average value now stands at £209,988 after rising by 0.6% quarter on quarter, the lowest rate since July, the lender’s data showed.
A stamp duty cut for first-time buyers announced in the Autumn Budget is set to have a limited impact on the market, as households are squeezed by the cost of living, according to the building society’s chief economist Robert Gardner.
He said: “The decision in the Budget to abolish stamp duty for first-time buyers purchasing a property up to £300,000, with relief for those purchasing a property up to £500,000, is likely to have only a modest impact on overall demand.
“In many regions, first-time buyers already paid little or no stamp duty as the price of the typical first-time buyer property was below the previous threshold of £125,000.”
Tax cut set to help London’s aspiring homeowners
However, estate agents in London said the stamp duty change has boosted first-time buyer activity in the capital.
Ewen Bunting, head of sales at estate agents James Pendleton, said: “There was a definite spike in offer activity and buyer registration immediately after the Budget but it slowly hit home throughout the month that more money in your pocket means there’s more in the competition’s wallet too.
“Regional differences in the response to the change are to be expected.
“However, despite it being welcomed by first-time buyers, there are still signs in London that prices need to come down further to stimulate increased activity higher up the price ladder.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, added: “It really is too early to say what impact the removal of stamp duty for first-time buyers will have on the housing market but the early signs have been encouraging.
“Lenders are also likely to be more accommodating of first-time buyers, with Barclays already reintroducing 95% loan-to-value deals.
“With mortgage rates remaining low, this should support activity in the market to some extent.”
Annual price growth was measured at 2.5% after declining through 2017 from around 4-5% at the end of 2016 and start of this year, as household budgets have been squeezed by inflation and lower wage rises.
Low supply is thought to be underpinning prices, as well as cheap mortgage rates.
Gardner added: “Low mortgage rates and healthy rates of employment growth are providing support for demand, but this is being partly offset by pressure on household incomes, which appears to be weighing on confidence.”