Feb

29

Property prices fall in February

Filed Under General, World News | Posted By Jennifer Sullivan | Leave a Comment

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

House prices fell in February by 0.5%, says the latest survey from Nationwide. The fourth consecutive monthly fall in property prices puts the cost of the average UK home at £179,358.

keys

The annual rate of house price inflation fell from 4.2% in January to 2.7% in February, the lowest since November 2005.

But the building society warned against gloomy predictions for the housing market, claiming that recession was “a remote risk for the UK economy”.

Trend continues

Various surveys have charted a decline in the housing market since last summer, with the Land Registry the latest to show a slowing in the annual rate of house price inflation.

Nationwide said the trend was of weakening prices but the drop in the annual rate of increase overstated the overall situation. This was because house price growth was particularly strong in January and February last year.

Higher energy bills and food costs have put more pressure on household finances.for sale

Meanwhile lenders have become more fussy about who they lend to because of the crisis in the banking industry.

No more so-called 125% mortgages are available and the 100% mortgage market has shrunk significantly in recent months.

The Bank of England’s Monetary Policy Committee cut interest rates from 5.5% to 5.25% in February.

‘Uncertain market’

Aggressive rate cuts in the coming months were unlikely, according to Nationwide’s chief economist Fionnuala Earley, but the economy was much weaker than it was a year ago.

“It should not be surprising that we are entering a slower phase,” she said.

“It is encouraging that the outlook is one of just that, slower economic growth rather than recession.”

She added that the reluctance of buyers given the current uncertainty in the market was not a surprise, but conditions for the UK housing market were “perhaps less gloomy than some would have us believe.”

Source: news.bbc.co.uk/1/hi/business/7269894.stm



Tags: , , ,