Money News
House prices fell for the third straight month in December, according to the latest national housing market survey from Hometrack, the Housing Intelligence Business.
Average values fell by 0.3%, the largest monthly fall since January 2005. The year on year rate of growth meanwhile slipped back to 3.0%, the lowest rate of growth since June 2006.
The average time to sell reached 8.3 weeks - the highest level since the survey began in 2001 - while the extent of price falls also increased with agents reporting prices down across 30% of the country, the highest level since February 2005.
Richard Donnell, Hometrack's Director of Research notes that the second half of the year has seen a major reversal in confidence on the back of higher interest rates and concerns over the outlook for the financial markets. The greatest turnaround in market conditions has been seen in southern England where the market is slowing off a high base. Many would-be buyers have stepped back from the market and the greatest short term casualty has been lower levels of market activity with sales volumes down by 18% over the last 6 months.
The weakening in demand has resulted in small headline house price falls, primarily over the last 3 months of the year. These have been concentrated in the areas where the market has been generally weak over the course of 2007 or where the market has slowed off a high base.
Areas such as South Yorkshire, Nottinghamshire and North Lincolnshire are examples of markets where growth has been limited all year - here prices have fallen by up to 1% over the whole of 2007.
The strongest growth over 2007 was seen in the "Central London and City" area where values were up 9.4%, but where they've fallen by 1.1% over the last 3 months.
Oxfordshire recorded the largest fall in values over the last 3 months (-1.5%) although values were up 4.2% over the whole of the year.
Despite the recent cut in interest rates, levels of market activity are likely to remain subdued over the course of 2008, especially over the first half of the year," says Donnell.
"Overall we expect average prices to rise by just 1% over 2008 with sales volumes projected to be down 17%," he adds.
24 December 2007 © Moneyextra.com
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