Annual house price inflation falls to 3.4%

Latest figures from Rightmove, the property website, show annual house price inflation in England and Wales falling to its lowest level since December 2005.

The average asking price for a home fell 0.8% in January, giving an annual rate of increase of 3.4%, down from 4.8% in December.

January saw the third consecutive monthly fall in property prices, although the figures are not seasonally adjusted.

Rightmove also reported an increase in activity immediately after the New Year, with a rise of almost 20% in the number of visits to its website, as compared with the first two weeks of 2007.

Miles Shipside, commercial director of Rightmove comments: “Some homebuyers are now able to find properties that have fallen into their affordability zone, and are bagging what they see as bargains against previous prices.”

He adds that: “Some properties have had their prices dropped by 10% or more and are now within reach, satisfying some of the pent-up demand from previously disenfranchised buyers.”

The January fall can, in part, be attributed to the December deadline for sellers to provide Home Information Packs, resulting in a glut of smaller homes for sale.

Estate agents recorded an increase in property stock of around 20% at the end of 2007 and the time that stock remained on the market increased to a record 98 days during December, although the figure fell back to 95 days in the first weeks of January.

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