Another drop in house prices for October

October has seen another fall in house prices in the UK according to recently released figures. The figures have been released by Nationwide, and the High Street lender has said that the dearth of buyers in the UK has resulted in continued falls with house prices.

The average property price in the UK is said to have fallen by £2400 in October, with the Nationwide’s house price index falling by 0.7 percent over the course of the month due to buyers steering clear of the market. Over the course of the month the average property price has now fallen to £164,381.

Over recent months the pressure on house prices in the UK has been mounting, as buyers have shied away from the market for a variety of reasons. There are many would be buyers that simply cannot get a mortgage due to current restrictions in the market, and many others that could get a mortgage but cannot afford the high deposit levels that lenders are asking for.

Another factor that is likely to have a serious impact on buyer interest and property prices is the spending Review recently outlined by the coalition government. The sweeping spending cuts that have been proposed will have raised concerns amongst households and individuals who are now in fear of losing their jobs due to the cuts in the public sector, which could also have a knock on effect on the private sector.

An economist from Nationwide said: ‘If the recent trend in house prices were to continue through November and December, the annual rate of house price inflation would drop to between 0% and minus 1% by the end of 2010. This would compare to a rate of 5.9% at the end of 2009.’

Tags: economist, Business Finance, buyer, finance, Nationwide Building Society, average property price, Spending Review (United Kingdom), lenders

Property prices increase again

According to data released by a High Street lender property prices have increased again in May, and the average property price is now closing in on the peak achieved in 2007 before the inset of the global credit crisis sent property prices tumbling. The data has been released by the Nationwide Building Society, which has reported a 0.5 percent increase in May, taking the average house price to £169,162.

Despite the increase in property prices the lender did warn that there was a shortage of properties on the market for sale, which meant a low level of property transactions that was affecting property prices. Since February of last year average house prices have increased by 12.2 percent according to the lender, and the average house price is now only 9.5 percent lower than the peak in 2007.

In terms of monthly increases the level of the increase seen in May was lower than those seen in March and April, with the May increase coming in at 0.5 percent compare to 1 percent in March and 1.1 percent in April. Officials have said that whilst the news of rising property prices will be welcomed by homeowners the lack of transactions in the housing market had remained relatively low since the end of last year.

One industry official said that stock shortages and low interest rates had been lifting house prices, but added that it was likely that more properties would come onto the market as a result of the government getting rid of Home Information Packs.

An economist from the Nationwide said: ‘Housing market conditions remain characterised by thin transaction volumes and a relative scarcity of properties for sale, despite a slow return of more sellers in recent months. The current supply-demand balance on the market is still consistent with relatively stable to modestly upward trending prices.’

Tags: building, low interest rates, prices, Business and Economy, global credit, property

Housing market may be cooling

There are very early signs that the UK housing market may be slowing down.

That is according to Nationwide Building Society, which says house price growth in January was the lowest it has been for eight months.

According to the firm, prices increased by just 0.3 per cent in January, a significant drop on the 1.2 per cent increase seen in December.

“House prices increased by just 0.3 per cent in January, the smallest monthly rise since May last year, which pulled the annual rate of house price growth back into single digits,” said Fionnuala Earley from Nationwide.

“Prices increased at an annual rate of 9.3 per cent in January, down from 10.5 per cent last month.”

The building society has also predicted that house prices will remain firm despite the recent rise in interest rates and the possibility of further rises in the year ahead.

“2007 started off with a bang as the Bank of England raised interest rates for the third time in six months. Only time will tell how much the surprise decision will affect sentiment in the housing market,” added Ms Earley.

The average price of a house in the UK currently stands at £173,225, down from the £173,746 price in December.

Tags: price, Fionnuala Earley, firm, economics, house, significant drop, Nationwide Building Society