House prices fall 10.9% year-on-year
by Gill Montia
Halifax has published its latest House Price Index, showing a 1.7% fall in the average value of a UK home, in July.
According to the research, the annual rate of decline now stands at 10.9%, with the average home now worth £177,351, compared to £199,084 a year earlier.
However, the monthly fall in prices appears to be slowing and is down from the 1.9% in June and 2.5% in May.
Using the more reliable three month comparison, the average price of a property calculated over the period from the beginning of May to end July is 8.8% lower than for the same period of 2007.
The lender says house prices continue to suffer from a shortage of mortgage funds and rising inflation but is optimistic that high levels of employment, low interest rates and a shortage of new houses will continue to underpin the market.
According to Halifax, the average home now costs roughly the same as in June 2006 and is still £44,980 more expensive than in July 2003.
Last week, Halifax’s owner, HBOS, predicted that UK house prices will fall by up to 20% over 2008 and 2009 combined.
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