Further falls for house prices
Updated on 30 April 2008
Recording the biggest drop since 1996, Nationwide becomes the second major housing survey to report sliding house prices.
On Monday Hometrack, which looks at prices agreed between buyers and sellers, said prices down were down for the first time - 0.9 per cent on last year.
Nationwide's report, which looks at the valuation of properties when people get a mortgage, has recorded a 1 per cent drop.
This time last year the average home cost just over £180,000. But this month the value of that same property is around £178,000. A fall of almost more than £1,700.
This is the first annual fall since 1996 - and by a greater amount. That year prices dropped only 0.5 per cent.
But is it such a surprise? The National Association of Estate Agents (NAEA), which says house prices have fallen consistently for the last seven months, calls for perspective: over the last five years house prices have risen a good deal, and there is still the backdrop, it says, of low unemployment, low interst rates and strong demand for houses.
But as the credit crunch bites down on the market, could this demand be waning as borrowers are unable to get same degree of credit from banks that was available this time last year?
Not everyone is as up beat as the NAEA. Senior Bank of England official David Blanchflower predicts a 30 per cent drop in house prices and warns the UK could be heading towards recession.
