House Prices - Latest Reviews

It seems that everyone has an opinion on the housing market nowadays and can produce a series of statistics to support their view

To make matters worse, many of them seem at odds with each other, and with what you read almost daily in your papers, so we’ve picked out some of the more reliable data, to help you try and make sense of what’s happening.

Nationwide, the UK’s biggest building society, this week released their latest house price index, and while the figures confirm the downturn in house prices, things are not as gloomy as many people would have you believe. The release confirms that house prices have dropped in January but on average throughout the UK the drop was a modest 0.1%. What this means to you and I is that a property valued at £200,000, lost £200 off it’s value in Jan, and in the 12 months to Jan 2008 is still in the black as prices have risen on average by 4.2%. While this is positive news for the UK’s homeowners, it is the recent trend that we should pay more attention to, and this shows that Jan was the third consecutive month that prices have fallen.

The Land Registry index supports the Nationwide figures albeit a month behind, as they reported the same December fall of 0.4%. However, their more detailed look has thrown up some areas that have bucked the trend with the north east showing the most resilience with prices growing by over 2% for the month. They also reported that the most active price range in 2007 was properties sold for between £100,000 and £150,000 but it is not until the value rises above £500,000 that the number of sales in 2007 is higher than 2006, with the biggest increase in sales being those properties sold for £1.5-£2 million.

The Royal Institute of Chartered Surveyors have also weighed in with some encouraging news, announcing that their measure of new buyer enquiries at estate agents, (which can be a good leading indicator of mortgage approvals) showed a modest increase between October and December having bottomed out in September after falling steadily since the second half of 2006.

Whilst many of these figures are not as bleak as they might be, we are not out of the woods yet, and with January traditionally being a very active month, it could be masking a gloomier picture. Don’t forget also that the underlying trend is down, and with lower mortgage approvals being registered, the purchase market looks set to remain slow.

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