House prices dip 1.1% in November
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UK house prices fell in November as higher interest rates and increased mortgage repayment costs took their toll, the Halifax has reported. According to the lender, house prices fell by 1.1% in November, taking the annual rate of growth down to 6.3%, compared with 8.9% in October. The Halifax calculates that the average residential property across the UK now costs £194,895. It added that activity in the housing and mortgage markets was also slowing. Pressure The fall is the largest monthly drop since December 2006. It is also the first time since 1995 that the Halifax figures have shown house prices falling for three successive months. Halifax chief economist Martin Ellis said the increase in interest rates between July 2006 and July 2007 had taken effect.
"Higher mortgage repayments and falling real earnings have put pressure on households' income, resulting in a slowdown in both house price growth and activity," he said. But he said he believed the housing market still had a "very solid foundation". "Strong market fundamentals, a structural housing supply shortage and pent-up demand from a large number of potential first-time buyers will support house prices, preventing a sustained and significant fall," he added. Halifax argues the market is further underpinned by the fact that employment levels are at a record high. |
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