The Department for Communities and Local Government stated that whilst overall prices increased by 2.9 percent the actual house price increases varied from area to area, and its report provided a breakdown of which areas had seen increases and by what level.

The report showed that England saw a 3 percent increase in house prices last year, whilst Scotland saw an increase of 3.8 percent. The level of increase seen in Wales was just 1 percent, and in Northern Ireland there was actually a fall in house prices, which fell by 6 percent.

This gave the overall house price increase of 2.9 percent across the UK, although some lenders have suggested that the increase for last year was greater than this.

A couple of lenders, Halifax and Nationwide, claimed that last year saw property prices increase by around 6 percent in the UK. However, the government report suggests that increases were not as high as this and therefore recovery in house prices was not as great as may previously have been reported.

The figures from the Department for Communities and Local Government indicate that property prices have now increased for eight months in a row. Many have seen these increases as signs of sustainable recovery within the property market.

One economist from Global Insight stated: “Virtually all house prices measures, including the DCLG, indicate that house prices troughed in the early months of 2009 and have been firming ever since. The revival in house prices since the early months of 2009 is a consequence of buyer affordability and interest being lifted by sharply reduced mortgage availability.”

Government reports on house price increases last year is a post from: Glitec Loans

David Miles stated that whilst the news was not good for homeowners it was not bad news for everyone, as first time buyers may be able to benefit from the falling house prices, providing them with increased affordability.

He said: ‘I am at the pessimistic end of the spectrum, but I don’t think it should be seen as the pessimistic end because there are as many gainers as losers.’

He also added that those on lower incomes could benefit from the house prices falls, as this group, as well as first time buyers have struggled to get onto the property ladder in the past few years. However, mortgage lenders have been making their criteria for first time buyers and those with poor credit much tighter to minimise risk to themselves, and this means that those wishing to get onto the property ladder may have to find a much larger deposit in order to qualify for the more affordable rates.

The prediction from Miles, who is Chief Economist at Morgan Stanley, is one of a line of recent predictions relating to house prices falls in the UK, which are expected to fall by a significant level over the course of this year and into next year.

Recent additions:

• Crippling mortgage rates for first time buyers with no deposit
• Impressive figures on buy to let mortgages
• Trial shows HIPs not as successful as hoped
• Many first time buyers facing soaring mortgage rates

Industry expert predicts 20% fall in house prices over two years is a post from: Glitec Loans