UK house prices property 2017
The UK residential property market is in the midst of a summer slowdown Reuters

UK house prices declined by 0.1% between April and June compared to the preceding three months, the third straight quarter in which prices have fallen, according to Halifax.

This represents the first time house prices have dropped for three consecutive quarters since 2012, with the average price of a house in Britain now at £218,390 ($282,960).

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House prices in the three months to June were still 2.6% higher than in the same period in 2016 – the lowest annual rate recorded since May 2013.

On a month-on-month basis, prices were down 1% in June following a 0.3% increase in May. Analysts had forecast a 0.2% expansion.

Halifax said rising inflation and stagnant wage growth had weakened demand for housing in recent months, flattening price growth.

"Although employment levels continue to rise, household finances face increasing pressure as consumer prices grow faster than wages," said Martin Ellis, housing economist at Halifax.

"This, combined the new stamp duty on buy to let and second homes in 2016, appears to have weakened housing demand in recent months.

"A continued low mortgage rate environment, combined with an ongoing acute shortage of properties for sale should help continue to underpin house prices over the coming months," Ellis added.

The number of first-time home buyers reached an estimated 162,704 in the first half of 2017, more than the 154,200 recorded in the same period last year.

Last month, Nationwide said the squeeze on household incomes was negatively affecting housing market activity, while the British Bankers' Association said mortgage approvals continued to fall in May.

Some 40,437 mortgages were approved for house purchases during the month, a 3.3% decrease on the same period a year ago.

Nationwide chief economist Robert Gardner said: "Given the ongoing uncertainties around the UK's future trading arrangements, the economic outlook remains unusually uncertain, and housing market trends will depend crucially on developments in the wider economy."

"Nevertheless, in our view, household spending is likely to slow in the quarters ahead, along with the wider economy, as rising inflation squeezes household budgets."