HOUSE prices edged up 0.2% last month, according to figures published

today by the Halifax Building Society.

The small rise compared with a 2.1% jump in February, but the society

said the underlying trend since the autumn was a gentle price recovery.

It remained confident that prices would rise by around 5% over the

course of this year.

The annual rate of increase dropped sharply last month, falling to

2.6% from 3.8% in February, but this reflected a big monthly rise in

March last year which dropped out of the year-on-year calculations.

''This annual rate is likely to fall further in April before rising

once more throughout the rest of 1994,'' said the society, the UK's

largest mortgage lender, with 1.86 million borrowers.

It added that it based its optimism for the rest of the year on a

recovery in the housing market which was strong towards the end of

March.