House prices falling at slower rate

Nicky Burridge,Press Association
Friday 26 June 2009 12:33 BST
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The rate at which house prices are falling showed further signs of moderating during May, figures revealed today.

The average cost of a property in England and Wales dropped by just 0.2 per cent during the month, following a slide of the same amount in April, according to the Land Registry.

The group said that while house prices were still falling on a monthly basis, the rate at which they were declining was easing.

The Land Registry also reported a drop in the annual rate at which house prices are falling, with this slowing to 15.9 per cent from 16.2 per cent during April, leaving the average property now worth £152,497.

Five of the 10 regions of England and Wales saw price rises during the month, with Wales leading the way with a 1.2 per cent jump, followed by the East at 1.1 per cent, with the North West and West Midlands both seeing a 1 per cent increase.

But at the other end of the scale, prices dived by 4.3 per cent in the North East during May.

The average cost of a home was also 2.3 per cent lower in Yorkshire and the Humber, while property values slid by 1.5 per cent in London.

On an annual basis, all regions of England and Wales continued to see double-digit price falls, with the North East and East Midlands seeing the greatest year-on-year drops at 17.2 per cent and 17 per cent respectively.

In line with recent reports that buyers are beginning to return to the market, the Land Registry reported a 26 per cent jump in the number of homes changing hands during March, the latest month for which figures are available, to 33,161.

But despite improving for the second month in a row, the figure was still only around half the level of transactions reported in March 2008 of 57,929.

There has been a run of positive data on the housing market recently, with both Nationwide and Halifax reporting price rises during May, while the British Bankers' Association recently said mortgage approvals for house purchase had risen to a 13-month high during the month.

But despite signs of improvement in the market, economists have warned that they still expect further price falls, due to rising unemployment and the continuing mortgage shortage.

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