House prices have increased for the second consecutive month, albeit at a much slower rate than the same period last year, new figures from Nationwide have shown.

According to the figures, the average property price increased by 0.5% over February, following January?s rise of 0.4%.

Housing market activity appears to have ?bottomed out? following the lull towards the end of the last year, Nationwide?s Group Economist, Alex Bannister said.

Mr Bannister believes market sentiment has now stopped deteriorating, and that buyers may soon start returning to the market, a trend Hometrack, the property market research company, has already observed.

According to Hometrack?s latest market survey, new buyers registering with estate agents rose by a massive 28.5% over February, following a fall of 12.8% in January. Agreed sales also rose by 36% over the month.

John Wriglesworth, Hometrack?s Housing Economist, is optimistic for the future of the market: ?After over eight months of housing market doldrums, the first signs of a robust recovery have appeared. We expect prices to resume their long-term inevitable upward movement before the end of the year, fully compensating for the recent falls,? he said.

However, Ed Stansfield, Property Economist at Capital Economics, believes the signs of revitalisation are yet to appear: ?Buyers appear to have returned to the market in February in line with normal seasonal patterns, but most reports stress that buyers remain very cautious. We still believe that average house prices will fall by 20% over the next two to three years,? he said.