British house prices falling

HOUSE prices in England and Wales fell for the second month running during August as the market continued to feel the effects of rising interest rates.

Property website Hometrack said prices dipped by 0.1% during the month to August 18 to an average £152,100 (€226,448).

It is the second month in a row they have fallen by 0.1%, and monthly growth has been steadily falling since reaching a peak of 0.9% in February this year.

The group said during August that the number of people looking to buy a new home also fell by 4%, wiping out the excess demand there had been.

The level of the asking price sellers achieved fell for the fourth month in a row to 94.9%, the lowest since September last year. Homes are now taking an average of 5.3 weeks to sell.

Twenty-six counties saw price falls during the month, while prices stood still in 21 and rose in just 10. The largest price falls were seen in Surrey, north and east London, East Sussex and Berkshire, where prices dipped by 0.4%.

The highest increase in the cost of property was seen in North Yorkshire, although prices there rose by just 0.2%.

John Wriglesworth, Hometrack’s housing economist, said: “Recent interest rate rises continue to take their toll on the housing market this month as house prices take another tumble, albeit a minor one.

“House prices are now very near their peak in terms of affordability and the recent housing boom now appears to be well and truly over. We do not, however, expect any housing market crash.”

The group expects to see price rises plateau out over the next 12 to 18 months.