House Price Update 5 October 2011

UK House Prices Situation: Little price change but fewer active buyers

UK House Prices Forecast: Price declines seem inevitable at present

House Prices Static in September

The latest figures from Nationwide show that average UK house prices remained virtually unchanged in September, rising by 0.1%. This change leaves house prices an average of 0.3% lower than in September 2010.

Robert Gardner, Nationwide's Chief Economist said "Providing the UK recovery gradually gathers momentum in the months ahead, we continue to expect house prices to move sideways or to drift modestly lower over the remainder of 2011 and into 2012."

The assumption that the economic recovery will gain momentum is a big risk, however, something recognised by Gardner who commented that "the more challenging global economic backdrop has increased the downside risks in the period ahead."

Hometrack Figures Show Buyer Decline

While prices remained stable, the number of buyers coming to the market declined. The latest figures from Hometrack show that the number of new buyers registering with agents declined by 2.6% in September, following a 1.2% decline in August.

Hometrack also found a decline in new sellers, with new property listings falling by 0.6% during September.

Hometrack's figures showed that prices fell by 0.1% in September and the average percentage of the asking price achieved remained virtually unchanged, rising by 0.1% to 92.6%.

House Prices Down 2.6% Since Last Year

House prices have fallen by 2.6% since last August, according to the latest Land Registry house price index.

The Land Registry figures are a month behind – reflecting sales for the year to August – but include actual sale prices for all homes sold in England and Wales, unlike mortgage lenders' figures.

The Land Registry figures also highlight the decline in sales seen this year – between May and June 2010, an average of 54,650 homes were sold each month. This year, that figure has fallen by 9% to just 49,785.

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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