-Sep House Prices Down 0.4% m/m; Fall 1.4% y/y
LONDON (MNI) – House prices fell slightly in September after
seeing a spike in August, falling 0.4% on the month, according to the
latest House Price Index from Nationwide.
The Nationwide data show moderate levels of house price deflation,
with September prices down 1.4% on the year compared to down 0.7% in
August and a sharper 2.6% drop in July. Analysts had expected some fall
back from the August monthly spike, with the median forecast for a 0.2%
drop on the month in September.
The average UK house price stood at stg163,964 in September, up
from the stg162,228 trough seen in January but below the 2012 peak of
stg165,738 seen in June.
The Nationwide data, showing modest price deflation on the year,
contrasting with data from Land Registry which showed there was still
modest house price inflation in England and Wales in August, with London
property price gains far outstripping those in other regions. Overall,
house price surveys for 2012 have shown monthly movements in both
directions with, at worst, modest price deflation on the year.
Commenting on the data, Robert Gardner, Nationwide’s Chief
Economist, said that the Bank of England’s new Funding for Lending
scheme could provide some support for house prices over the coming
months, but warned that prices are likely to remain stagnant as the
economy struggles to reach take-off speed.
“Overall, we expect the UK economy to see a gradual recovery over
the next twelve months, with house prices remaining relatively flat or
declining only modestly over the same period,” he said.
While prices are unlikely to rise significantly over the coming
months, Gardner also said that the lack of supply of new housing stock
would offer some support prices.
He noted that in the four quarters through Q2 2012, the number of
houses built in England was 118,000, 25% below the average rate in the
five years before the onset of the financial crisis.
–London newsroom: 4420 7862 7491; e-mail: wwilkes@marketnews.com
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