The steep decline in house prices continues as both Halifax and Nationwide report a fall of over 2% for December.
Following the gulf in November’s results, the two lenders moved much closer in December, with Halifax quoting a drop of 2.2% for the month, and Nationwide 2.5%. Both lenders also quoted the annual decrease at around 16%.
Liberal Democrat Shadow Chancellor Vince Cable was just as pessimistic about the future and forecast that house prices could fall by a further 20%. He said: “Prices have now fallen nearly 20% from their peak and may well have just as far to fall again.
While Mr Cable’s views make for pretty glum reading, Nationwide’s consumer confidence survey suggests that the majority of householders also expect further losses. The survey found that in all 12 UK regions, the majority of those asked expect prices to fall further over the next 6 months with half the regions expecting to lose a further 6% over the period.
Nationwide reported that the most price resilient regional towns and cities were Durham, Edinburgh and Leicester, while those hardest hit by the property slump were Belfast, Bristol, Bradford, Northampton and Norwich.
Some good news came from the Royal Institute of Chartered Surveyors who found estate agents enjoyed the first increase in newly agreed sales for 18 months in November and the first rise in new buyer enquiries since October 2006. The increase in buyer enquiries tentatively suggests that buyer interest may be returning as a result of the reduction in interest rates in recent months, and the fall in house prices to date.