BT : UK home prices fall at slowest pace‏

Business Times - 03 Nov 2009


UK home prices fall at slowest pace

(LONDON) British house prices fell at their slowest annual rate since June 2008 last month, dropping 4.2 per cent, due to an ongoing lack of housing for sale after the credit crunch, property data company Hometrack said yesterday.

Hometrack's monthly survey of estate agents and surveyors showed that house prices rose 0.2 per cent in England and Wales last month on a non-seasonally adjusted basis, the same rate of increase as in September.

However, this rise was largely concentrated in London, where prices rose 0.4 per cent, while in 84 per cent of postal code areas, house prices were static last month, Hometrack said.

The number of new buyers registering with estate agents grew only 1.2 per cent, down sharply from an average of 7.5 per cent in spring and early summer when many Britons typically start house-hunting.

'The pent-up demand that has boosted the market in recent months is starting to fade in the face of firmer pricing and fewer clear bargains,' said Richard Donnell, Hometrack's director of research.

'Looking ahead, new buyer registrations are likely to slow further in the coming weeks as we approach Christmas. And with a continuing lack of new housing for sale, prices are expected to remain under upward pressure in the near term.'

Low interest rates and a sharp fall in house prices since their peak in late 2007 have made British property more affordable than in many years, but rising unemployment and the difficulty many homebuyers have in finding mortgages have kept a lid on demand.

Hometrack's survey shows weaker recent growth in house prices than that of mortgage lender Nationwide, which said on Friday that prices rose 0.4 per cent last month and were up 2 per cent on the year, based on mortgage approvals.

The Land Registry, whose record of completed transactions lags other surveys, reported that prices rose 0.9 per cent in September but were still 5.6 per cent down on a year earlier. -- Reuters