Its previous month's survey showed a rise of just 0.4%.

The monthly result meant that the annual rate of house price inflation grew to to 6.7%, from 5.6% in September.

Halifax said the underlying trend suggests a stable housing market with moderately rising prices and no sign or boom or bust.

Slowdown expected

"Nonethless, the expected sharp slowdown in the economy over the next year is likely to reduce housing demand and curb housing market activity," Halifax said in its survey report.

"Accordingly, we expect house price inflation to ease gradually during the remainder of 1998 and into next year, falling to 4% in the final quarter of 1999."

Conflicting signals

However, the Halifax survey produced distinctly more optimistic picture of the housing market than a similar survey by the Nationwide Building Society last week.

That survey also showed that house prices rose a modest 0.6% in October, and that the three-month trend indicated a moderate slowdown.

Halifax found that prices had risen 1.3% over the last three months.

The survey showed that the average price paid for a house in the UK in October was £73,764.

The average price paid by first-time buyers was £53,668 and the average price of a new house was £74,045.