The annual rate of house price inflation was subsequently knocked back to 2.7 per cent.
However Nationwide stressed that the potential risk of a UK housing recession remained 'remote.'
The average house price has now sunk to £179,358.
Fionnuala Earley, Nationwide's chief economist, said: “This is the fourth consecutive monthly fall in house prices.
"The trend in prices is clearly weakening. The 3-month on 3-month rate of price growth rate fell to -1 per cent in February, down from -0.4 per cent the previous month.
She added that the 'hawkish' Inflation Report published by the Bank of England following its February rate cut suggested the likelihood of further aggressive rate cuts was fairly slim.
"MPC members have been vocal since the publication of the Inflation Report, and the common message is that the outlook for the economy is much weaker than it was a year ago.
“The performance of the economy is highly relevant for the fortunes of the housing market - a brief glance at the relationship over the last twenty or so years makes this abundantly clear.
"So while there are several factors which are slowing housing market demand, from poor affordability to weakening house price growth expectations to tighter credit conditions, the fact that an economic recession in the UK seems unlikely provides some support for the overall health of the housing market."
