House Price Update to 18 November 2009

UK House Prices Situation: Most areas have positive annual growth

UK House Prices Forecast: Seasonal slowdown expected until at least February

Rightmove Figures Show Start of Christmas Slowdown

Christmas is not a good time to be a turkey and traditionally, it isn’t a good time to sell your home, either. This year looks to be no different, according to the latest House Price Index from property website Rightmove.

According to Rightmove, asking prices have dropped by 1.6% in the last month. This marks the beginning of the usual housing market Christmas slowdown, which Rightmove expects to last until February. “We now expect three months of asking price falls before a tentative recovery in early spring, likely followed by pre-election jitters”, says Miles Shipside, Rightmove’s Commercial Director. This comment suggests that the market may well remain weak until the middle of next year, after the general election.

Despite this pessimistic outlook, 2009 has been a better than expected year for the majority of the UK’s homeowners. Seven out of ten regions have seen an overall increase in house prices over the last year, with an average national rise of 1.6%. Only three regions have been left in negative territory – the East Midlands, north and north west.

According to Shipside, the speed of the recovery is being hampered by the slow recovery of the mortgage market. He notes that people may find it difficult to move for work “if they have insufficient equity in their current property to get a new mortgage at a competitive interest rate.”

Stamp Duty Holiday Benefited 27% of Home Buyers

New figures calculated by the Council of Mortgage Lenders show that 27% of home buyers in the last year have benefited from the current stamp duty holiday, which exempts properties priced between £125,000 and £175,000 from stamp duty. This relief is due to end on December 31st.

However, homeowners in some areas of the country have not benefited at all – where average house prices are above £175,000 or below £125,000, the stamp duty holiday has had no real impact. High deposit requirements for new mortgages have been far more significant, affecting many buyers’ ability to enter the market.

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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