Home prices in the U.K. inched upwards to close the first quarter of the year on strengthening employment, although the yearly trend continues its strong downwards trend, according to The Daily Telegraph. On Wednesday, Halifax reported that home prices increased by 0.1% in March from the previous month to reach an average value of £162,912. Despite the small increase, prices dropped 0.6% during the first quarter from the previous three months, and prices slipped 2.9% year-over-year, marking the largest such drop since October 2009.

Halifax economist Martin Ellis said the data showed, “House prices continue to fall at a modest pace,” and forecast that prices will slip by 2% during all of 2011. According to Bloomberg, the chairman of Berkeley Group Holdings, Tony Pidgley, forecast that home prices in the U.K. will rise by as much as 5% during 2011 due to a shortage of new properties on the market. Pidgely estimated that 130,000 homes will be completed in 2011, which would fall short of demand. Savills has reported separately that the U.K. could face a housing supply shortfall of one million properties by 2015.

Click here to read the story on March home prices from The Daily Telegraph.

Click here for coverage of Pidgley's forecast from Bloomberg News.