By Charlotte Beugge

The value of the typical UK home fell by 1.3% in 2011, according to Britain's largest lender, Halifax. In December 2010, the typical house price was £163,665 but by December 2011 it was £160,063 - a fall of £3,602.

But the fall in price showed a marked improvement from the picture in the middle of last year - the annual fall in house prices in the year to May was 4.2%.

Over the year, there was little change in the market, with the number of house sales compared with unsold properties remaining little changed over the time. Stable - or indeed stagnant - market conditions have managed to keep house prices fairly unchanged over the year.

Things did pick up towards the end of the year, with a small increase in the number of sales - with November's sales at 79,000 the highest for two years. But this didn't manage to stop total sales for the first 11 months of the year being 2.5% lower than in the same period in 2010.

Martin Ellis, housing economist at Halifax, says: "House prices held up well last year in the face of the difficult and deteriorating economic climate and substantial pressure on households' finances. If the UK can avoid recession, we expect broad stability in house prices in 2012."

But he adds that the UK's economic prospects are still on shaky ground and are largely dependent on how things develop in Europe.