29 October 2007 House prices fall for first time in 2 years
Prices cool fastest at the top end of the market
House prices fell by 0.1% in October, the first price fall for 2 years. This follows two months of zero growth with the annual rate of growth falling back to 4.4%. Average prices were down between -0.1 and -0.2% across all regions except for the West Midlands where values remained unchanged.
Higher value areas see above average price falls?
Above average prices falls of between -0.3% and -0.5% were largely concentrated in the higher value areas of London and the South East such as Central London and the City (-0.5%), South West (-0.4%), Hampshire (-0.4%), Cambridgeshire (-0.3%) and Oxfordshire (-0.3%). These are all areas that have registered strong price growth over the last two years and from such a high base are the most sensitive to the current weakening in demand.
Buyer numbers and sales agreed have also fallen?
The number of buyers has been falling for the last four months and in October agents reported a -6.4% fall in potential buyers registering. New buyer registrations are down 17% over the last four months. This in turn has led to a decline in the number of sales being agreed ? down -4.8% in October.
Length of time it takes to sell a property is increasing?
The weakness in demand and market activity means that the average length of time it takes to sell a property is rising from a recent low of 5.8 weeks in May 2007 to the current 7.4 weeks in October. We?re also seeing the beginnings of a return to a buyer?s market. Nationally agents are reporting that buyers are achieving 94.3% of the asking price, down from 94.8% last month.
House prices to slow over the coming months?
Overall we expect the rate of house price growth to slow over the coming months but the scale of these falls is likely to be limited by a lack of supply of properties coming to the market for sale.