In Focus

05 December 2008 04:08 BST

2008 – the year of the house price crash?

The property bureau at inthenews.co.uk takes a look at the most recent house price indicators to let you know the current state of the British housing market.

The UK housing market is bracing itself for its worst 12 months for more than a decade.

So says the Royal Institute of Chartered Surveyors (Rics), which claims market conditions have not been so adverse since the early 1990s.

In January house price indices reported falls and static growth across the board, continuing the faltering trends of the autumn and winter of last year.

Despite the bleak picture, property experts have been emphasising the positives, however scarce they may be, as for every worried homeowner there is a very eager first-time buyer eyeing the house price falls with glee.

But with the slashing of interest rates by federal banks across the world confirming fears of a recession – hot on the heels of the collapse of the US subprime mortgage market, the sundering of Northern Rock and the unprecedented fraud at Societe Generale – even first-time buyers can ill afford to be too cheery.

Halifax HPI

January: Zero house price growth recorded in first month of 2008. Static growth leads to one per cent fall over last three months.

But Halifax chief economist Martin Ellis waylaid fears of a housing price slump.

"We expect sound economic fundamentals and lower interest rates to support house prices," he claimed.

"Nationally, we predict that house prices will be flat in 2008."

Nationwide HPI

January: Property prices slip by 0.1 per cent. Nationwide index reports fall for third consecutive month.

Martin Gahbauer, the building society's senior economist, revealed annual house price inflation had fallen to its lowest level for more than two years – 4.2 per cent.

He elaborated: "The weakening trend in house prices during the last three months is consistent with the loosening in housing market conditions that has become increasingly evident in the data.

"This undoubtedly signals a continued cooling in annual house price inflation during the months ahead."

Rightmove HPI

January: Asking prices slip by 0.8 per cent. Rightmove says residential asking prices at lowest level since December 2005.

But the property website insists there are signs for optimism, despite the fall.

Its commercial director Miles Shipside explained first-time buyers were picking up "bargains" following recent dips.

"Some properties have had their prices dropped by ten per cent or more and are now within reach, satisfying some of the pent-up demand from previously disenfranchised buyers," Mr Shipside said.

Hometrack HPI

January: Average property value slips by 0.3 per for second consecutive month. Hometrack reports faltering prices for the fourth month in a row.

Hometrack's director of research Richard Donnel explained that house prices were not the only worry for estate agents in January.

The monthly index found fewer buyers on the lookout; homeowners taking longer to sell their properties; and a lack of new properties coming on to the market.

But he added: "Despite lower levels of market activity and weak confidence among buyers, demand for housing still exits 'at a price'.

"While underlying prices are posting small falls, asking prices are under the greatest pressure."

Land Registry

December: House prices in England and Wales fall 0.4 per cent. Government data reveals first official monthly fall since August 2005.

The official figures placed annual house price inflation at 6.7 per cent and the average property price at £184,469.

Commenting on the survey a Land Registry statement said: "This month's data provides evidence of a downward trend in house prices.

"Although the annual growth rate remains positive, this month's price fall is a clear indication of a weakening market."

Rics housing market survey

November: 60.1 per cent balance of surveyors report fall in house prices. Rics warns UK property market is facing worst conditions for 15 years.

Rics spokesman Jeremy Leaf moved to soothe fears British property could be braced for its worst house price falls for more than a decade.

"While sentiment seems to have reached its lowest ebb, the underlying economic conditions are vastly different to what the country experienced in the early 1990s," he argued.

But Mr Leaf added: "The housing market is clearly feeling the pinch from the credit crunch and the round of interest rate hikes in 2007."