There was good and bad news in the property market as reports revealed that house prices dropped by 13.5 percent in 2008 but mortgage approvals rose in December.
House prices in England and Wales dropped by a total of 13.5 percent last year, according to the Land Registry.
Seen by many as the main authority on the property market, the organisation's figures are in keeping with other reports which showed a serious drop in housing value. Its figures showed a two percent drop in December, with the average house now costing £158,846.
However, statistics from the Bank of England also revealed optimism in the market. The number of mortgage approvals during December rose by 4,000 to reach 31,000, although this was still the second lowest value since the figure began being recorded.
The Bank's figure means that lending dropped by 58 percent over the whole of 2008, with just 519,000 mortgages approved, compared with 1,250,000 the year before. Some analysts have predicted that 2009 will record even worse approval numbers.
This pessimism was reflected in the latest figures from Nationwide. The mortgage lender's report for January - lenders release their statistics around a month ahead of the Land Registry - showed a drop in prices of 1.3 percent, less than December's 2.5 percent, but marking a higher annual fall.
"The deepening economic recession and financial market turbulence continued to weigh on housing market sentiment and activity," said Nationwide's senior economist, Martin Gahbauer.
