House prices rose for the first time since 2007 in March in a surprise bounce, although experts warn there may be further falls to come.

According to the monthly house price index from Nationwide, the price of a typical house rose by 0.9 per cent in March, reducing the annual rate of fall from 17.6 per cent to 15.7 per cent.

This brings the price of the average house to £150,946, the first rise since October 2007.

Fionnuala Earley, Nationwide’s chief economist, said: “The moderation in the annual rate of fall is somewhat distorted by conditions last year and so it would be unwise to draw strong conclusions from the significant slowdown in the annual rate of fall.

“Equally, while the rise in prices in March is welcome, it is far too soon to see this as evidence that the trough of the market has been reached.”

Strong measures taken by the Bank of England to ease economic tensions will help the housing market, Ms Earley added, but these will take time to filter through.

David Smith, senior partner at Dreweatt Neate estate agents, said: “Nobody is going to pop the champagne corks quite yet.

“Looking at the state of the economy, it is impossible to believe this bounce will be the start of a sustained rise in prices. However, there is no doubt that the Nationwide’s March figures are a reflection of the growing number of positives we are seeing on the ground.”

Mortgage approvals were up in February, after months of decline, while buyer interest in the market has also been rising.

“People are genuinely looking again, sensing now could be the opportunity of a lifetime, mortgage rates are historically low and mortgage approvals are up. Things are a lot more buoyant than they were even three to four months ago,” Mr Neate added.