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Halifax reports show drop in British house prices
By Fiona Shaikh |
July 9, 2009, Thursday
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Print Edition
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BRITISH house prices fell a smaller-than-expected 0.5 percent in June, taking the annual rate of decline to an 11-month low of 12.5 percent, figures from mortgage lender Halifax showed yesterday.
June's monthly fall came after a 2.6 percent rise in May and contrasts with figures last week from rival mortgage lender Nationwide, which showed house prices rose by 0.9 percent last month.
Halifax said although there were signs housing market activity was stabilizing, the uncertain economic outlook meant house prices were likely to be volatile in the coming months.
"Overall, we expect to see a continuing mixed pattern of monthly house price rises and falls over the remainder of 2009," said Halifax economist Martin Ellis.
"Although activity is showing signs of improving, it is still at a very low level historically," Ellis said.
But some economists and analysts were sceptical whether or not the downward trend in British house prices was over.
"The Halifax data reinforce our doubts that house prices have bottomed out and we certainly do not think that we are now at the start of a renewed sharp upward trend," said Howard Archer, economist at IHS Global Insight.
The figures are another indication that the economy is still some way off a recovery, and suggest that monetary policy will likely remain loose for a while.
Halifax said house prices in the three months to June were down 15.0 percent compared with a year ago, the smallest decline since last November. That left the average price of a home at 157,713 pounds (US$253,720).
Analysts had forecast a fall of 0.7 percent for June, and a three-month annual decline of 14.7 percent.
June's monthly fall came after a 2.6 percent rise in May and contrasts with figures last week from rival mortgage lender Nationwide, which showed house prices rose by 0.9 percent last month.
Halifax said although there were signs housing market activity was stabilizing, the uncertain economic outlook meant house prices were likely to be volatile in the coming months.
"Overall, we expect to see a continuing mixed pattern of monthly house price rises and falls over the remainder of 2009," said Halifax economist Martin Ellis.
"Although activity is showing signs of improving, it is still at a very low level historically," Ellis said.
But some economists and analysts were sceptical whether or not the downward trend in British house prices was over.
"The Halifax data reinforce our doubts that house prices have bottomed out and we certainly do not think that we are now at the start of a renewed sharp upward trend," said Howard Archer, economist at IHS Global Insight.
The figures are another indication that the economy is still some way off a recovery, and suggest that monetary policy will likely remain loose for a while.
Halifax said house prices in the three months to June were down 15.0 percent compared with a year ago, the smallest decline since last November. That left the average price of a home at 157,713 pounds (US$253,720).
Analysts had forecast a fall of 0.7 percent for June, and a three-month annual decline of 14.7 percent.
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