Despite all-time lows in mortgage interest rates house prices increased by just 0.1% month-on-month, while annual growth fell from 5.7% annually to February.
Average UK house prices have now reached £189,454 – 2% above pre-crisis levels.
Robert Gardner, Nationwide's chief economist, said: “Economic conditions have remained supportive, with labour market conditions continuing to improve and mortgage interest rates close to all-time lows.
“Nevertheless, the pace of housing market activity has remained subdued, with the number of mortgages approved for house purchase in January around 20% below the level prevailing one year ago.”
Prices in Wales declined by 0.5% in the first quarter of 2015, while London growth also softened according to Nationwide.
In its market commentary the society said there has only been a modest pickup in housebuilding since the sharp falls seen in the financial crisis.
In 2014 around 119,100 homes were built in England, 11% higher than in 2010, but 25% below the average building rate in the five years before the financial crisis.
Gardner added: “Hopefully, construction activity will strengthen further in the period ahead.
“The major house builders appear to have capacity to expand supply, with most reporting land banks, which, at current rates of building activity, could support construction for more than five years.
“Demand prospects remain favourable thanks to the strength of the labour market, continued low mortgage rates and schemes such as Help to Buy, which are helping to provide those with smaller deposits access to mortgage finance.
“This in turn should help to provide house builders with confidence that there will be demand from buyers if the homes are built.”
More affordable regions such as the North and North West have seen the smallest increases in housing stock, with a rise of 1.1% from 2011 to 2014, well below the average of 1.9% for the whole of England and Wales.
In the South East and South West, where house prices are expensive at more than six times average incomes, housing stock has risen by 2.1% and 2.4% respectively.
In London housing stock increasing by 2.6% from 2011 to 2014 period, but based on the relationship between earnings and prices Nationwide said it would have expected a rise of around 3.1% in the capital.
