UK House Prices Situation: Slight downwards movement in most areas

UK House Prices Forecast: Continued falls throughout 2008

Nationwide Confirms Third Month of Falls

Nationwide Building Society has this week published its latest House Price Index, covering the month of January.

Its figures reveal that average UK property prices fell by 0.1% in January - the third consecutive month in which prices have fallen. January's fall is not as great as December's 0.4% fall but brings the rolling average increase for the last year down from 4.8% to 4.2%.

Nationwide Senior Economist Martin Gahbauer commented that "The weakening trend in house prices during the last three months is consistent with the loosening in housing market conditions that has become increasingly evident in the data … This undoubtedly signals a continued cooling in annual house price inflation during the months ahead."

Land Registry Index Confirms Nationwide Stats

The Land Registry has also published its latest House Price Index this week - although this one covers December, not January. This lag is due to the Land Registry's index being based on completed sales, not just approved mortgages.

The Land Registry found that the average house price had fallen by 0.4% in December - coincidentally exactly the same size fall as Nationwide observed in December.

The Land Registry index, which includes cash purchases as well as mortgaged ones, found that the average house price has risen by 6.7% over the last year - slightly higher than Nationwide's figure. This could perhaps be explained by the inclusion of house purchases at the very top (£m's) of the market - which are not normally mortgaged and have risen strongly this year.

Mortgage Approvals Continue to Fall

The British Bankers' Association (BBA) has announced that mortgage approvals fell by 38% in December, as rising credit costs take their toll. The December figure of 42,088 was an all-time low, the BBA said.

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