UK house prices continue to decline
Nationwide has reported a 15 consecutive fall in UK house prices, with confirmation of a 1.3% reduction in prices in January, and the UK land registry house price index also revealed a 2% reduction in prices in December and a revision of the November fall from 1.9% to 2.1%. The Nationwide figures show an annual fall of 15.9% while the land registry index shows a drop of 13.5% over the same period.
It would appear that 2009 has continued very much in the vein of 2008 with very little interest from buyers and sellers drip feeding their properties onto the market at ever lower prices. The ongoing accumulation of unsold properties means that there is likely to be a time lag between a recovery in UK economy and a recovery in the UK property sector. We also await assistance from the UK banking sector with UK mortgage approvals down by over 50% over the last 12 months and unlikely to pick up substantially in the short term.
It is also rather telling that despite the collapse in the UK exchange rate, demand from overseas investors for UK property has not increased significantly of late. In a reflection of these difficult times it is also interesting to see that the constant reduction in UK property prices is no longer grabbing headlines as it did just a few months ago, suggesting that many have now resigned themselves to the fact that UK property may be dead in the water for the short to medium term.
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