House prices fall in September
According to a recent report house prices have fallen again in September, with officials from the Halifax claiming that prices have dropped by around 1.3% for the month. The Halifax has stated that the September fall means that the annual price drop now registers at 12.4%, and the average house price has now fallen to £172,108. The Halifax stated that mortgage lending conditions were still very tight, and this meant that the state of the market was likely to remain difficult.
Compared to the average house price last September the average price of a property this September is 13.3% lower. This is said to be the biggest fall recorded by the Halifax. Officials have now said that the average house price now is roughly the same as that in early 2006, a year and a half before property prices peaked in October of 2007. The third quarter of this year has seen house prices decline by a total of 5.1% according to recent figures.
Martin Ellis, chief economist at the Halifax, said: “The ongoing pressures on householders’ income, combined with the reduction in the availability of mortgage finance mean that market conditions will remain challenging.”
He added, however, that the surprise interest rate cut of 0.5% could help, stating: “Lower interest rates will help mortgage borrowers faced with increasing pressures on their finances and provide a valuable support to the housing market.”
One economist from Global Insight said that house prices are likely to continue falling. He stated: “Faster rising unemployment, heightened concerns over the economic outlook and widespread expectations that house prices will continue to fall markedly seem set to depress housing market activity and prices for some considerable time to come.”
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