British house prices continue to decline

Laura Humble, Bloomberg

The average cost of a home in England and Wales decreased for a 14th month, dropping 0.1% from July to £161,000 (236,223), the lowest since November 2003, a survey by the London-based property website Hometrack showed yesterday. Values slid 3.7% in the past 12 months and will decline 5% in 2005, said Hometrack.

The central bank pared the benchmark interest rate to 4.5% this month after growth cooled in the first half. The nine-member rate-setting committee was divided over the decision, with Governor Mervyn King and three others opposing the cut because of worries inflation might accelerate. The property market has slowed since the Bank of England raised rates five times in the 10 months to August last year to curb a decade-long housing boom.