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House prices moving sideways

House prices moving sideways

Category: Mortgages

Updated: 01/07/2011
First Published: 01/07/2011

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The malaise in the UK housing market shows no signs of abating, as property prices remained unchanged in June.

At the end of the month, the average price of a home in the UK was £168,205, 1.1% lower than at the same point last year.

The three month on three month measure of house prices was 0.3%, slightly weaker than the 0.6% increase recorded in May, figures from Nationwide show.

"The property market has moved sideways over the past six months, and June's data suggests that trend is being maintained through the summer months," said Robert Gardner, chief economist at Nationwide.

The property market is stuck in a subdued period, with supply and demand both sluggish.

"There have been a few encouraging developments for households but to date this hasn't been enough to reinvigorate the housing market," added Mr Gardener.

"Employment has been edging up and consumer confidence surged in May – although the latter may have been more to do with unusually warm weather and extra bank holidays, rather than signalling the arrival of any recovery-related feel good factor."

It now appears that the mortgage market will continue with only modest rises and declines over the rest of 2011.

"Economic growth looks set to gather pace in the months ahead, but it is likely to remain unspectacular.

"This in turn points to only modest gains in employment and sluggish wage increases, which will continue to keep many potential buyers on the sidelines."

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