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House prices fall again

  • 08/07/2010
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Average UK property prices fell by 0.6% in June.

According to the latest Halifax House Price Index, this was the second consecutive monthly decline, following a decrease of 0.5% in May.

However, looking at longer-term trends, prices in the second quarter of this year are just 0.1% lower than the first quarter, indicating stabilisation rather than freefall in the housing market.

According to Halifax data, the average UK property is now worth £166,203.

Martin Ellis, housing economist at Halifax, said: “This continued the slowdown in house price growth since the beginning of the year following the moderate recovery in prices during much of 2009. This pattern is in line with our view that house prices will be broadly unchanged over 2010 as a whole.

“A shortage of properties for sale in 2009 contributed to an imbalance between supply and demand and was a key factor driving up house prices last year. An increase in the number of properties available for sale in recent months has helped to reduce the imbalance, relieving the upward pressure on prices. The low level of interest rates, however, continues to support housing demand.”

Catherine Penman, head of research at property consultants Carter Jonas,said: “What is clear from the latest Halifax figures and last week’s figures from Nationwide, is that any thoughts being entertained that the housing market was through the worst and well on the road to recovery were a touch premature.

“The price gains at the start of the year were never likely to continue, with a market underpinned by a scarcity of good stock rather than a healthy flow of buyers and sellers, and with public sector cuts and higher taxes looming on the horizon, we are likely to see price stagnation for the remainder of the year.”






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