House prices fall after four months of steady progress

Published 23rd Jun 2009

House prices dived in June after four months of improvements, figures out today from property website Rightmove shows


House prices took a dip again in June after four months of gradual improvements, fresh data published shows.

Britain's biggest property website Rightmove said that the average price dropped by £1,000 in June, 0.4%, to £226,436, compared with a rise of 2.4% in May. Prices are now down 5.5% over the past 12 months

Rightmove said that the number of properties on the market has dwindled as sellers are put off by the slow market. The number of new properties for sales in southern regions was down 45% in the January to June period compared with the same period a year ago. It was down 40% in the north.

The greatest monthly rise in house prices was in the North West, which saw prices jump by 4.5% to an average £170,562 in June and the biggest fall was in East Anglia, where prices fell by 6.6% to £207,166. In London, the average price slipped by 0.1% £397,140.

The company believes that the mortgage famine is made worse by rising lender margins and interest rates, preventing many first-time buyers from mopping-up less saleable stock and repossessed properties.

There had been a run of positive data in recent weeks, with increased buyer enquiries showing signs of translating into sales and Halifax and Nationwide reporting house prices rises during May.

Miles Shipside, commercial director of Rightmove, said: "It's a mistake to confuse the upturn in enquiries and sales with a return to a more normal market. While conditions are much improved from last year, we are now starting to see some big distortions and wild swings due to the combined effects of recession and restricted mortgage availability. "As the best deals on property and mortgages are only open to the equity-rich, the new stock that agents are looking to attract has to match what these purchasers want to buy and can afford. Perennially popular areas with good schooling are 'in', while flats in large blocks and terraces requiring major works are out, meaning new sellers are having to adjust prices accordingly."

Source: ' Guardian '

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