House prices fall 0.8% in February - Land Registry

Published 29th Mar 2011

Official Land Registry figures show house prices down by 1.7% over the past year


House prices in England and Wales fell by 0.8% in February, taking the average price of a home to £162,215, according to Land Registry figures.

This marks the fifth month-on-month drop in six months following January's marginal rise, and takes the annual drop in prices to 1.7% – the largest year-on-year decrease since October 2009.

The average price of a home in England and Wales is now down 2.9% (or £4,763) from the peak of £166,978 in August 2010, according to the data.

Regionally, the east experienced the greatest monthly rise with an increase of 1.2%, followed by 0.6% in the north-west – they were the only regions to experience a monthly rise in house prices.

The biggest monthly fall occurred in the north-east, with a drop of 4%, followed by the West Midlands (-2.7%) and Yorkshire and the Humber (-2%).

The data also indicates that just two regions in England and Wales have notched a rise in average property values over the past 12 months, with London prices increasing by 3.2% to an average £341,048 and the east rising by 1% to an average £176,291. The region with the greatest annual price fall was the north-east, with a drop of 7.1%.

Completed sales

The most up-to-date figures available show there were 649,957 completed house sales in England and Wales in 2010 – a rise of 6% on the 2009 figure of 614,734. But in December 2010 the number of sales nosedived by 30% to 54,812 compared to 78,438 in December 2009.

The news follows an announcement from the independent Office for Budget Responsibility that it expects house prices to fall by 2.3% this year, and grow by just 0.1% next year, though many analysts are expecting sharper declines.

Howard Archer, chief European & UK economist at IHS Global Insight, said the Land Registry figures remained consistent with his long-held view that prices will continue to trend down in 2011 after losing ground overall in the latter months of 2010. "Specifically, we suspect that house prices will fall by around 5% in 2011 and end up losing around 10% from the peak levels seen in 2010," he said.

"We believe housing market activity and and house prices will remain under pressure for some time to come from high and likely to rise unemployment, negative real income growth, the increasing fiscal squeeze, very low consumer confidence, and ongoing difficulties in getting a mortgage for many buyers (particularly first-time buyers)."

But perhaps City bonuses were not as badly affected this year as many of us were led to believe: the number of properties sold in England and Wales costing £1m or more increased by 3% between December 2009 and December 2010 from 522 to 540.

The Land Registry figures show the least favourite sector among buyers was terraced houses, which experienced an annual drop in prices of 2.7%, followed by flats/maisonettes (-2.2%) and semi-detached homes (-1.6%). The price of detached homes fell by a marginal 0.3% year-on-year.

Source: ' Guardian '

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