by Mark Johnston
So far this year, house prices have fallen every month so far, industry experts are expecting more of the same as the year progresses. House prices have fallen by an average of about 2.9 per cent according to the Halifax house pricing index. So far, to the end of March, they have estimated that the average house price is about £162,912 representing a decline of 0.6 per cent on average from the previous quarter.
Martin Ellis, Halifax housing economist said: “Our forecast remains for a 2 per cent decrease in house prices in 2011 as a whole. Uncertainty over the general economic outlook and individual financial circumstances are likely to constrain housing demand, resulting in some modest downward pressure on prices.”
Economist at HIS Global Insight, Howard Archer said that “Despite the modest rise in March, we maintain the view that house prices will fall by around 5 per cent overall in 2011 and end up losing around 10 per cent from the peak levels seen in the first half of 2010.”
The average house price of £162,912 represents a 3.3 per cent fall on 2010. March 2010 saw the average house priced at £168,435, noted by Halifax’s measures. This is a rise of £215 from February. Howard Archer said: “We suspect that the tighter fiscal policy really kicking in from April and likely gradually rising interest rates will exert downward pressure on the housing market.”
Going on to add that with the continued and added that the increased unemployment, higher levels of debt and the problems that exist around actually securing a mortgage offer did “not bode well for house prices,”
Modest increase in house prices in March by 0.1 per cent did show progress but still flagged behind the 2.9 per cent of last year.
Housing economist for the Halifax, Martin Ellis, said “The overall decrease in prices in the first quarter of 2011 compared with the previous quarter was a little lower than the quarterly falls recorded in the third and fourth quarters of 2010,”
Some industry experts look at Halifax’s 2011 decline of 2 per cent and are concerned that the figure should be much higher.
Sky News have commented that “sn’t it interesting that with the lowest interest rates in history, house prices have not been rising? The economy is dire. We may not see it in London and the South East, but Northern Ireland they’re down by nearly a half.”
Interestingly, while Halifax reported a decline of 0.6 per cent in house prices, using markers that are notoriously volatile, the Nationwide showed a 0.6 per cent increase in the value of UK properties.
More reliable figures, recorded by the Land Registry for England and Wales, will be published on the 4th of May.
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