UK House Prices Situation: Enquiries up, Sales & Prices Still Down

UK House Prices Forecast: House prices touching bottom in late 2009

Halifax Reports Rise But Nationwide & Rightmove Disagree

Halifax may have grabbed the headlines this week with news that average house prices rose by 1.9% in January, but even it is at pains to point out that this is probably just a blip and is unlikely to be the start of a rising trend.

Halifax economist Martin Ellis commented that "Historically, house prices have not moved in the same direction month after month even during a pronounced downturn."

He also added that he believed that "2009 will be a difficult year for the housing market" although "There are some very early signs that market activity might be stabilising, albeit at quite a low level."

Other major house price indices reported falls in January. Nationwide's average house price fell by 1.6%, while property website Rightmove.co.uk recorded a 1.9% fall in asking prices.

Rightmove's forecast is for house prices to fall by 10% in 2009, reaching a floor late in the year. If this is correct, asking prices have a further 8% to fall this year. Miles Shipside, Commercial Director of Rightmove commented that he has seen "new [property] listings plummet" and that there has been a "dramatic reduction in the over-supply that has been present since 2008." He believes that this "may help to arrest price falls" as supply and demand become more equally matched.

As a comparison, Rightmove saw 43,416 properties come onto the market in January 2009 - against 89,110 in January 2008. However, it is probably too early for much optimism, a point highlighted by Nationwide's report.

Martin Gahbauer, Nationwide's senior economist observes "a pre-condition for recovery in the housing market is an end to the deterioration in the wider economy." In other words, house prices won't go up while the economy is going down.

Read about UK House Price indexes / key statistics that track the ups and downs of house prices

Read our take on the Credit Crisis the effect on UK House Prices and Mortgages. A Special Report

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