House prices fell for the fourth month in a row in February as evidence mounted that banks’ borrowing costs are again on the rise, putting further strain on households and companies.

The Nationwide Building Society on Friday reported another fall in house prices, dragging the annual inflation rate to 2.7 per cent, its lowest level in two years. The figures came as Bank of England data showed the number of mortgage approvals for property buyers remained at historically low levels in January, indicating weak demand from potential homebuyers.