No house price growth in August
House price growth has slowed in 2007
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Monday, 27, Aug 2007 08:23
House prices across Britain stayed the same this month for the first time since November 2005, according to housing intelligence business Hometrack.
Its national housing market survey registered unchanged house prices in August, continuing falls in growth for the fifth consecutive month.
While London recorded a monthly increase of just over 0.1 per cent, three regions – Yorkshire and Humberside, the north and south-west of England - saw falls in property values.
Hometrack's director of research, Richard Donnell, suggested that developments in the global economy were among other domestic factors making themselves felt among buyers.
"Buyer confidence has been weakening on the back of increased affordability pressures over recent months but the turmoil in the global equity markets has added a new external dimension," he said.
"If this continues it is likely to further undermine market sentiment which will drive weaker levels of demand into the autumn and further undermine the rate of house price growth."
There are also concerns that the Bank of England will continue its recent series of quarter-point rate hikes, which saw the base rate rise to 5.75 per cent in July.
But with consumer price index (CPI) inflation falling to 1.9 per cent in June, the immediate pressure on the Bank to restrict the flow of money has recently diminished.
Whether the five interest rate hikes already implemented will continue to restrict the property market this autumn remains to be seen.