29 November 2007 House prices fall for the second consecutive month
Prices down across a fifth of the country
House prices fell for the second month in a row over November with average values falling by 0.2% - this follows a 0.1% fall in October. The year on year rate of growth has fallen back to +3.6% which represents the lowest rate of growth since July 2006.
Price falls across 20% of the country...
Prices fell across 20% of the country with half these falls concentrated in southern England where demand has slowed most over the last few months.
The Christmas slowdown looks to have started early but the underlying market conditions remain weak with new buyer registrations down by 26% over the last 5 months.
Values continue to be supported by tightening supply...
The downward pressure on prices maybe coming from the demand side, but values are being supported by a continued tightening in supply. The majority of people don?t have to move and are waiting to see if the outlook becomes clearer in the new year.
The largest falls in new buyer registrations were seen in southern England. Since July buyer registrations in London, South West and the East were down by over a third, while in the South East they were down by closer to 40% over the same period.
But the southern half of the country has seen the greatest downward pressure on prices...
The downward pressure on prices is greatest in these southern regions where the market is slowing off a high base after very strong market conditions seen over the first half of 2007. Prices were down by 0.2% in London, the South East and South West with above average falls in the ?Central London and City? area (-0.5%) and South West London (-0.4%).
And across the country...
The largest monthly fall at a regional level was in the East Midlands (-0.3). Elsewhere there is a mixed picture of weak demand and static prices. Away from the south of England, the market has been relatively weak over the last 18 months and there is little, if any, ?froth? in current pricing levels. Buyers in these regions are more interest rate sensitive and it is affordability pressures that are having the greatest impact on demand.
Time taken to sell a property also slows...
The turnaround in market conditions has resulted in an increase in the average length of time a property stays on the market - up to 8 weeks in November from a recent low of less than 6 weeks back in the spring. The time on the market is set to rise further in the months ahead.
As does the proportion of asking price being achieved...
Nationally, the proportion of the asking price being achieved currently stands at 93.8%, the lowest level for almost 2 years Growing caution and price sensitivity among buyers means that this measure is likely to move lower in the months ahead.