House price growth stalled during June as the number of homes on the market continued to increase, figures showed today.

The average cost of a property crept ahead by just 0.1 per cent during the month to stand at £170,111, according to the Nationwide Building Society.

The group said property values had now risen by three per cent since the beginning of the year.

The low level of price growth during June, which followed a rise of 0.5 per cent in May, will further stoke speculation that the housing market recovery is flagging.

David Smith, senior partner at agents Carter Jonas which has abase in Summertown, said: "The figures are broadly what we were expecting to see in June, as the abolition of HIPs starts to have an impact on the supply/demand balance.

"There have been more properties coming onto the market in recent weeks, and although this is positive news for a market that has been bereft of stock, there hasn't been any noticeable uplift in buyer demand, which will inevitably see a suppression in house prices as a result.

"Where house prices go from here is difficult to predict.

"The fallout from the Budget will certainly have a major role to play in the coming months, with uncertainly surrounding impending public sector cuts and higher taxes, and of course we still have the ever-present threat of interest rate rises.

"Although these figures suggest house prices are starting to flatten out at their current level, the top end of the market is still performing remarkably well, with double digit price growth since the start of the year, and a stronger than ever demand for properties in desirable locations."