House prices hit two and a half year low
House prices across the UK have hit a two and a half year low with average year on year price falls of 7.3% but the bad news for home owners is that the situation is likely to get worse before it gets better. Recent figures also show that the supply of new homes in the UK has almost dried up which was expected but is a worrying sign for the UK's house building sector which faces another testing period over the next few months.
However, rather surprisingly there was an increase in the number of house sales completed in October which was up 5.4% on the previous month with many sellers now becoming a little more realistic about the prices which they can expect over to receive. It will be interesting to see if there has been any increase in mortgage approvals since the rescue package was approved as this is the vital element which should at least see sale volumes increase even if prices do not.
Evidence that house prices are falling is a concern but it was interesting to see that transaction numbers are up which would suggest that some investors at least feel there is some value in the market.
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