Housing prices in the UK are on an ongoing decline, confirmed figures published by financial service provider Halifax. According to the release, the average cost of a home dropped 1.4% during the last month, and 3.7% quarter-on-quarter compared with 2010, to stand at GB£ 160,395.
The report blamed the decline of real income rates, high debt levels and non-availability of credit for the diminished consumer confidence that was holding people back from purchasing property. The ongoing economic uncertainty is still putting a strain on demand for houses.
Property values are now only 4% above the low point of April 2009, but a whole 20% below what they were before the credit crunch in August 2007.
Nevertheless, Halifax expects the rates to fall at a slower pace in the upcoming months. Martin Ellis, housing economist for Halifax group, said: “Signs of a modest tightening in housing market conditions, a relatively low burden of servicing mortgage debt and an increase in the number of people in employment are all likely to be providing support for house prices, curbing the pace of decline”.
Experts expect housing prices to fall an additional 5-7% before fiscal cuts will pick up rates in early 2012. What kinds of houses enter the market in this time period as well as the availability of mortgages will also play a crucial role in getting the housing market back on its feet.
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