House prices in the UK fell 1.1% in February as higher mortgage rates and the cost of living continued to make homes less affordable.
Barring a small drop early in the pandemic, this was the first annual fall in property values since November 2012, according to Nationwide.
Prices also eased on a monthly basis, falling 0.5% from January.
The building society said it would be “difficult for the market to regain momentum in the short term”.
“Economic headwinds are expected to remain relatively strong, with broader expectations for the job market to weaken as the economy shrinks in the coming quarters,” said chief economist Robert Gardner.
He added that mortgage rates remained “well above” the 2021 lows.
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