Thursday 6 October 2011

UK house prices fell 0.5pc in September, declining for a second month.

UK house prices fell 0.5pc in September, declining for a second month. Compared to this time last year, prices are down 0.7pc to an average £161,132, Halifax figures show.
Reuters has produced this interesting graph of how house prices have correlated to average earnings over the last 30 years. We're still above the average of four times earnings, but creeping closer.



http://www.telegraph.co.uk/finance/financialcrisis/8782663/Debt-crisis-live.html



House prices fall for second month in a row - Halifax

Mortgage lender Halifax said the property market continued to lack direction after it reported a second successive month of lower prices.

House prices fall for second month in a row - Halifax
Halifax economist Martin Ellis said September's drop continued the mixed monthly picture so far this year with four rises, four falls and one month of no change in prices. Photo: ALAMY
A decline of 0.5pc in September followed a fall of 1.1pc in August, although Halifax said average prices in the quarter to September were still 0.1pc higher than the previous three months - the first such rise since early 2010.
Halifax housing economist Martin Ellis said September's drop continued the mixed monthly picture so far this year with four rises, four falls and one month of no change in prices.
He said: "This mixed pattern is consistent with a market where prices are lacking genuine direction."
The average UK house price in September was 1pc lower than in December 2010 on a seasonally adjusted basis, at £161,132.
Mr Ellis said the financial uncertainty was likely to be constraining demand but added that low interest rates and a rise in employment over the last year have been supporting the market.
"We expect little change over the remainder of this year," he said.
Typical mortgage payments for a new borrower have fallen from a peak of 48pc of average disposable earnings in mid 2007 to 26pc in the most recent quarter. This is well below the average of 37pc over the past 25 years and the lowest since 1997, the lender said.
This week, price comparison website MoneySupermarket said the average fixed two-year mortgage deal of 3.82pc was the lowest since it began compiling records in 2007, down from 4.01pc in August.
The latest drive downwards saw Leeds Building Society launch its lowest ever two-year fixed-rate mortgage with a rate of 1.99pc.

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