by Mark Johnston
House Prices Fall Again in September.
Halifax, the nation’s biggest mortgage lender, has reported a third monthly fall in house prices which has thus fuelled fears about the state of the housing market.
The latest figures from the halifax have shown a 0.4 per cent decline in property prices in September and these figures appear to replicate what the Nationwide’s index found earlier this week.
However, many financial experts believe there is no sign of a general house price crash as occurred in 2007 and 2008, with some parts of the country, notably London, still seeing rising prices.
The typical house price fell to around £159,486 in September, representing a 1.2 per cent fall on a year ago and a 0.4 per cent drop month-on-month, according to the halifax latest house price index.
Matthew Turner, director of Astute Property Search buying agents, said: “While low mortgage payments may be supporting house prices, the ongoing difficulty to secure finance at higher loan-to-values is preventing the market from moving forward.”
Martin Ellis, Halifax housing economist, said: “The generally weak economic climate remains a significant constraint on housing demand.”
While house prices continued to edge lower last month, according to the Halifax the market is expected to remain subdued but stable into 2013.
Robert Gardner, Nationwide’s chief economist, said that “monthly price changes have been skewed by a number of one off factors this year, such as the ending of the stamp duty holiday, for instance”.
However, Rightmove’s latest house price index suggests that the average price of a property coming to market this September is virtually unchanged on a year ago.
Miles Shipside, Rightmove’s director and housing market analyst said: “The state of the housing market is little different now to this time last year and prices have stagnated as neither buyers nor sellers have been forced to change their behaviours in sufficient quantities to stimulate greater activity.”
Economists have predicted that the Bank of England could pump some more stimulus in to the economy at November’s meeting.
It also seems that September marked the first time since January that seller numbers decreased, while demand from potential buyers has been shrinking for the last four months.
According to recent research, while demand among buyers has fallen for the last four months, September also registered the largest fall, with a 3.6 per cent decrease, compared with a smaller 0.9 per cent drop in the volume of new properties coming to market.
However, in more upbeat news it appears that the percentage of the asking price achieved remained unchanged in September at 93 per cent.
Richard Donnell, director of research at Hometrack, a property website, suggested that “Pricing will remain under slow, downward pressure but the tightening of supply will limit the scale of price falls in the short term.”
In conclusion, overall, it is expected that the UK economy to see a gradual recovery over the next twelve months, with house prices remaining relatively flat or declining only modestly.
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