Average UK house prices continue to grow moderately, according to the Halifax.

The mortgage lender reports that house prices rose by 1% in August, an overall increase of just 0.2% over the past three months (May to August 06) compared with a 2.9% rise in the preceding three months.

Martin Ellis, chief economist at the Halifax, said: "Augusts increase was smaller than the 1.4% rise in August 2005, contributing to a slowdown in the annual rate of house price inflation to 8.2% from 9.4% in June. We expect this trend to continue over the coming months with the annual rate easing to 5% by the end of the year."