House Price Update 21/9/11

UK House Prices Situation: House prices weak (except London)

UK House Prices Forecast: Demand is currently preventing serious falls

Govt Figures Show Falls Across UK – Except London

House prices fell by an average of 1.5% over the year to the end of July 2011, according to the latest figures from the Department for Communities and Local Government (DCLG). Despite this, the true picture is that house prices have fallen in every part of the UK except London, where they have risen over the last year.

The DCLG figures also showed that the divide between new property prices and previously-owned dwellings continues to expand. The average price paid for a new home in July was 6.7% higher than a year ago, but the average price paid for a previously-owned home was 2.1% lower than a year ago.

Rightmove Sees Asking Prices Creep Up Again

Asking prices are creeping up again, according to the latest Rightmove figures which show that the average asking price rose by 0.7% in September, following a 2.1% fall in August.

This leaves the annual rate of change at +1.5%, up from -0.3% in August.

Rightmove's latest house price index emphasises how little has changed over the last three years. The volume of properties on the market and being sold remains low and asking prices have only risen by an average of 2.5% over the last three years, meaning that they have fallen substantially when set against inflation.

The current stamp duty holiday on properties under £250,000 is due to end on 25th March 2012, after which stamp duty of 1% will be due on properties over £125,000. Miles Shipside, Rightmove's Commercial Director, is keen to emphasise the need for some urgency in the minds of both sellers and buyers:

"It’s a tight but feasible deadline to find and be in a new home for Christmas. The stamp duty relief has more teeth to bite you in the pocket if you miss it, but that is a tasty incentive as long as you beat the deadline."

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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