UK House prices fell 0.1% in quarter four, Halifax says

Date: Friday 06 Jan 2012

House prices in the UK barely fell during quarter four versus the previous quarter, according to the latest survey data from mortgage lender Halifax. Prices fell 0.9% on the month and by another 1.3% on the year, to £160,063.

Nonetheless, the annual rate of change in house prices finished the year clearly higher than the low of -4.2% seen in May.

Halifax attributes that improvement mainly to the “stability in the overall supply/demand balance in the market.”

Commenting on the data however, Martin Ellis, housing economist at Halifax, said:

"(…) If the UK can avoid recession, we expect broad stability in house prices in 2012. There is, however, considerable uncertainty regarding the prospects for the UK economy which will, to a large extent, depend on how events in the Eurozone unfold. In addition, the extent to which households choose to reduce their debts will also affect growth. As a result, the outlook for house prices is also uncertain."

Economists at Barclays Capital, for their part, are saying this morning that, “(…) The MPC looks at the 3m/3m average of the Nationwide and Halifax surveys as a result of the volatility in these individual series. This measure reported house prices were unchanged in December after falling by 0.2% 3m/3m previously. We expect falling inflation to boost growth in real household incomes during 2012, although we predict that the labour market outlook will worsen, and as a result we forecast only modest growth in house prices this year.”

AB

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