As you are no doubt aware, there have been hints of good news on the UK housing market of late.

Recent data has suggested mortgage approvals have picked up, the Royal Institution of Chartered Surveyors has observed an improvement in enquiries at estate agents, and Hometrack reported the lowest fall in its monthly index in ten months in March. But the big one came from Nationwide. It recorded a 0.9 per cent rise in house prices in March.

This morning, all eyes turned back to Britain’s biggest building society. For this morning, its April index was revealed. What did it say? Would prices continue to rise? Would we see a sharp fall cancelling out the previous month’s improvement? Or maybe the finding would be somewhere in the middle?

According to the Nationwide, house prices fell by 0.4 per cent in April. So that’s down, but not by enough to cancel out last month’s rise. The annual rate of house price inflation is now minus 15.7 per cent. Prices are now down by 18.4 per cent from the October 2007 peak.

The quarter on quarter fall, which the Nationwide says is a more reliable indicator, saw prices fall by 3.1 per cent, from 4.1 per cent this time last month.

Fionnuala Earley, Nationwide’s Chief Economist, had a thing to say about the extension of the stamp duty holiday. Ms Earley pointed out that the typical house price is now below the new threshold everywhere but in London and the Outer Metropolitan region.

It is easy to be dismissive of the impact of the changes in stamp duty, but don’t forget, for first-time buyers the real challenge is saving up for a deposit. If they can avoid paying stamp duty, then it becomes a lot easier.

It does seem that many of the economists in the housing market try to present a glass-is-half-full image of the industry. It doesn’t matter how bad things are, they always seem to find something to celebrate, leaving the rest of us wondering if they have any credibility at all. But Ms Earley has been one of the more realistic of the bunch. Last month, when the building society reported a rise in prices, Ms Earley was saying yes but…

This refreshing honesty was visible this month too. She said: “It seems more likely that, for the most part, buyers will remain cautious as long as they think that prices will continue to fall. The latest data from Nationwide’s Consumer Confidence Survey shows that consumers still think that prices will fall over the next six months. However, there has been a significant moderation in the rate at which they think prices will fall. This, along with the recent pick up in buyer enquiries and the increase in house purchase approvals in February, has encouraged some to suggest that this is the turning point in the market. While affordability is indeed more favourable and there does seem to be some cautious optimism from some quarters, it is still far too soon to say that this is the start of a solid revival in the market.”

There is no doubt about it. Things have eased a tad for the housing market of late. Whether this is a spring bounce which will soon go into reverse, or something more encouraging, only time will tell.

But there is reason for caution. For one thing, it does seem implausible that house prices could recover while unemployment is rising so sharply. Secondly, those who are being seduced by the current low rate of interest need to beware. Rates will go up eventually. Those who can obtain credit right now may be able to enjoy rock bottom interest rates, but they need to be sure they can afford to continue paying the mortgage in the event that rates shoot up.

© Investment & Business News 2013