Residential property prices in the UK were unchanged in October compared with the previous month following 15 consecutive months of house price growth, fresh data released by mortgage lender Nationwide shows.

The figures reveal that home prices were flat last month, compared with a monthly increase of 0.3% in September.

Compared with October last year, prices rose by 4.6%, which was a fall from September’s annual increase of 5.3%, taking the average price of a home in the UK to £205,904, down from £206,015 the preceding month.

But despite cooling house price inflation, the typical UK home now costs six times average annual earnings, which is the highest prices/earnings ratio for more than eight years.

Over the last three years, home prices have increased by 20%, while wages have risen by only 6%, the Nationwide said.

The mortgage lender said the slowdown in the housing market broadly reflects the changes to stamp duty in April this year, when buy-to-let landlords were faced with sharp tax hikes in the form of a 3% stamp duty surcharge, as well as the scrapping of the 10% wear and tear allowance.

Howard Archer, an economist with IHS Markit, said he expected house prices to fall by around 3% next year when Britain launches its negotiations to leave the European Union, which contrasts with the 0.5% growth projected by JLL in 2017.

Uncertainty over Brexit negotiations could further exacerbate the supply crisis in this country with housebuilders putting activity on hold, which “would, in the longer term, increase pressure on prices”, according to Rob Weaver, director of investments at property crowdfunding platform Property Partner.  

He commented: “Despite a slowdown in house prices, we’ve seen remarkable resilience and sustained stability in the residential market.

“The housing supply shortage alongside a growing population, low unemployment, and record low interest rates, has continued to prop up prices.” 

One month of stagnant prices is “neither a surprise nor a cause for panic”, according to Jonathan Hopper, managing director of Garrington Property Finders, but “it is an indication of how much of a buyer’s market it has become”, he said.

He continued: “Prices in the immediate aftermath of the referendum were flattered by an injection of pent-up demand as buyers who had sat on the fence in the run-up to the referendum finally got off it.

“But with the impact of that temporary prop now fading buyers who remain, frequently hold the whiphand – with many feeling empowered to ask for a substantial discount in return for the certainty of a sale.

“Yet pragmatism rather than panic prevails among sellers, which has so far prevented wholesale price cutting.”

Hopper also believes that home prices will be supported by a “chronic shortage of supply” in many areas, but the shift in the balance of power from seller to buyer is palpable.

“Reassured by rock bottom interest rates, a robust labour market and an economy that continues to grow steadfastly, intent remains strong among domestic buyers,” he added.