Record Annual House Price Fall
31/07/2008
House prices have experienced their biggest annual fall since Nationwide began its housing survey in 1991.
After a 1.7% drop in July, house prices are now at an 8.1% annual decline. The Nationwide survey discovered that house prices are at their lowest level since August 2006, having fallen for nine months in a row.
The survey found that the average home now costs £169,316 which is nearly £15,000 cheaper than in the same month last year, but still £11,000 higher than three years ago. Nationwide's chief economist Fionnuala Earley said: "The weakening economy and poor housing market sentiment do not suggest that the market will recover quickly."
Sellers remain reluctant to accept lower offers. Combined with the current difficulty in obtaining mortgages, this has imposed a slowdown on house purchase activity.
There is some good news for buyers who want to obtain a mortgage to take advantage of the falling house prices. Swap rates - the key influence on mortgage rates - have fallen slightly, which has allowed fixed rate mortgages to fall in cost.
Additionally, if oil prices continue to fall, borrowers could benefit from rapid cuts in interest rates.
After a 1.7% drop in July, house prices are now at an 8.1% annual decline. The Nationwide survey discovered that house prices are at their lowest level since August 2006, having fallen for nine months in a row.
The survey found that the average home now costs £169,316 which is nearly £15,000 cheaper than in the same month last year, but still £11,000 higher than three years ago. Nationwide's chief economist Fionnuala Earley said: "The weakening economy and poor housing market sentiment do not suggest that the market will recover quickly."
Sellers remain reluctant to accept lower offers. Combined with the current difficulty in obtaining mortgages, this has imposed a slowdown on house purchase activity.
There is some good news for buyers who want to obtain a mortgage to take advantage of the falling house prices. Swap rates - the key influence on mortgage rates - have fallen slightly, which has allowed fixed rate mortgages to fall in cost.
Additionally, if oil prices continue to fall, borrowers could benefit from rapid cuts in interest rates.
