House prices strengthened unexpectedly in December after three successive monthly falls, Halifax’s index showed on Tuesday, but analysts said the rebound was unlikely to signal an end to the housing market slowdown.

The lender said house prices rose by 1.3 per cent last month, beating forecasts of a 0.5 per cent fall. But prices in the fourth quarter of 2007 were 0.8 per cent below their level in the third quarter, and Halifax said the annual increase of 5.2 per cent was below the long-term average of 8 per cent for only the second time since 2001.