Bad news for housing industry as prices fall again
House prices have fallen again.
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Thursday, 02, Sep 2010 05:17
By Chris Malone
The UK housing market has suffered a second consecutive month of price falls for the first time since 2009.
A 0.9 per cent month-on-month reduction in August followed a 0.5 per cent decrease in July, with the average property costing £166,507, according to Nationwide figures.
The statistics are still better than those in the same months last year, with August and July showing a 3.9 per cent and 6.6 per cent year-on-year increase respectively.
Nationwide chief economist Martin Gahbauer explained that it is the first time since February 2009 that house prices have fallen in back-to-back months.
He noted that a smoother indicator of the market can generally be taken from looking at the three months to the current date in comparison to the previous three.
This indicator showed a change from a 1.2 per cent increase in July to a zero per cent increase in August, signalling a summer stagnation.
"Unless house prices bounce back strongly in September, the three-month rate of change will turn negative next month," Mr Gahbauer said.
The expert added that the rate of inflation - the year-on-year change - remained positive, but is down on the same figures from previous months.
Meanwhile, MyMortgageDirect has suggested that there has to be more confidence shown in the mortgage market for the industry to fully recover.