House prices fell yet further in November and are now at almost exactly the same level they were a year ago. The average price of a home has fallen away in the second half of 2010 as sellers return to the market. A lack of housing stock had previously seen house prices rise steadily since the trough seen in April 2009.
In November, prices fell by 0.3%, with the average home in the UK costing £163,398, down from £164,381 in October. Prices are barely removed from the same point a year ago when the average house price was £162,764, according to Nationwide.
The annual price change at the end of November was 0.4%, a marked fall from just a month earlier when a figure of 1.4% was recorded.
Despite the falls, the three month on three month rate of change – considered to be a smoother indicator of the recent house price trend – rose from -1.5% to -1.3%, and remains well above the deeply negative rates of -5% and -6% that were seen in the most severe phase of the 2008 downturn.
Martin Gahbauer, chief economist at Nationwide, said that there is little evidence to suggest that house price declines are likely to accelerate in the coming months.
"Much of the weakness in property values since the Spring has been driven by a return of sellers to the market, following unusually low levels of property for sale in 2009 and early 2010," he added.
"However, there is little to indicate that these sellers need to achieve a sale urgently for financial or economic reasons, which means that the downward pressure on house prices is only modest.
"In addition, there are early signs that the flow of new property onto the market may be slowing down again as potential sellers observe the recent weakness in prices and decide against marketing their properties at the current juncture.
"Similar seller behaviour was observed in late 2008 and early 2009, eventually leading to a decline in the amount of property on the market."
At present, house prices sit some 19% below their 2007 peak, with mortgage approvals close to being 50% below their historical average.
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