House prices register monthly fall of 0.9%

Latest figures from Hometrack, the housing intelligence firm, show a 0.9% drop in annual house price inflation in April. A month earlier, prices registered an annual gain of 0.4%; a year earlier, an annual rise of nearly 7%.

Values fell across half the UK, whereas in March only 29% of postcode districts registered a fall.

Hometrack attributes the continued decline to a lack of confidence in the market and the ongoing mortgage famine.

Mortgage costs are continuing to rise and the credit crisis has caused many lenders to actively discourage new business by withdrawing best-value products and increasing deposit requirements.

The current lack of confidence in the market will not be helped by the fact that Hometrack has now reported a slide in house prices for the seventh consecutive month.

Many homeowners and potential first-time buyers are choosing to sit out the downturn, so that in April, the number of new buyers registering with estate agents fell 4% on March, and the number of houses listed for sale fell by 1%.

Meanwhile, the average time taken to sell a property rose to 9.1 weeks, from 8.5 weeks in March.

Richard Donnell, Hometrack’s director of research, believes that confidence is the key issue in today’s housing market and in that respect, the downturn cannot be compared with events in the early 1990, when the market collapsed because of a failing economy.

Discuss this in the Finance Markets forums

Story link: House prices register monthly fall of 0.9%