House prices fall 10.5 per cent in a year

Published:
28 August 2008
Topic:
News,Money,Mortgages

Potential home buyers frightened by the uncertain economic situation have fuelled the fastest fall in house prices for nearly 18 years, figures show.

Nationwide Building Society's monthly price index has revealed that the average cost of a home in the UK has dived by 10.5% during the 12 months to the end of August, the biggest drop since the final quarter of 1990.

The rate at which property values are sliding also accelerated during the month, with prices falling by a further 1.9% in August, following drops of 1.5% and 0.9% in July and June respectively.

House prices have now fallen for 10 months in a row and lost 10.3% of their value since the beginning of the year, to leave the average property costing £164,654.

Fionnuala Earley, Nationwide's chief economist, said: "While the pace of monthly falls picked up during the month, the less volatile three month on three month measure eased very slightly in August to 4.5% from 4.6% in July."

She said recent activity levels in the market had been "very subdued", although she added that data from estate agents suggested that some "glimmers of interest" were returning to the market, possibly as a result of price falls and the opportunity buyers had to negotiate big discounts.

Copyright © PA Business 2008

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