Government Traces Modest Fall in House Prices

by Peter Wakeford
Posted by Hannah on 17 September 2008
Government Traces Modest Fall in House Prices

A surprise one percent rise for July has been marked by the DCLG's survey.

In July house prices stood 0.3 per cent lower than they did 12 months before, government statistics have shown.

However, despite the annual drop the department for communities and local government (DCLG) figures found that the value of the average UK home actually rose by one percent across the month.

Other house price surveys from lenders Nationwide and Halifax have tracked months of consistent price decline - and both have found that the average value has dropped by over ten per cent from a year ago. The large difference in results is likely to be due to the different methods employed by the surveys: while the lenders base their figures on mortgage approvals, DCLG prefers to use mortgage completions.

Effectively, this means that trends on the government survey tend to lag behind those of the lenders.

DCLG's data also found big regional variations, with prices falling by 10.3 percent in Northern Ireland over the 12 months - and rising by 3.6 percent in Scotland over the same period.

Speaking to the BBC, Seema Shah at Capital Economics said: "Other more timely measures [show] house prices weakening drastically in the past few months, and with the economy heading for recession, those falls are likely to intensify over the coming months [on the DCLG survey]."

Compare Mortgages now via money.co.uk.

Get our free money saving newsletter
Join over 480,000 other subscribers who grab our expert money tips, unmissable money guides & hottest bargains each week in our special email...