According to one of the country’s leading mortgage lenders, the Nationwide, house prices fell by 0.6% in June, to £165,738. This brings the annual decline in prices to 1.5%, which is the sharpest decline seen in three years by the building society. The decline in property value has been put down to the weakness of the nation’s economy and the end of the stamp duty holiday for first-time buyers. In its report, Nationwide also stated that there are few signs of a near-term economic recovery and that the outlook for the market is “highly uncertain.” The other big lender, Halifax, has not yet released it figures for June, but it did show a monthly rise of 0.5% for May with the less volatile three-monthly figure standing at +0.8%.
North – South Divide
The Office for National Statistics (ONS) has shown that the UK housing market is very much a two-speed animal. Prices in London have risen by 4.9% in the last year, compared to a national average of just 1.4%. House prices plunged by 8.1% in Northern Ireland, 1.3% in the North West of England and Yorkshire and the Humber. There were also modest falls in Wales and Scotland. Geography has always been a key factor in the housing market, but the recent lack of activity has highlighted the divisions.
It has also been shown that there is a stark difference in the number of repossessions, with those living in the north being much more likely to lose their home. Analysis of court-ordered repossessions, broken down by postcode revealed that the north east and M62 corridor – which includes parts of south Yorkshire and industrial Lancashire – were the regions most at risk. With public sector austerity and weak economic growth these northern urban areas have clearly found it difficult to keep up the mortgage payments. Chester has the highest number of people losing their home, with 53 repossessions per 10,000 households in the second half of 2011 – a statistic that represents over three times the national average. Also nearing the top of the gloom list are Oldham and Darlington with 27 and 26 repossessions per 10,000 homes, respectively.
Sources: bbc.co.uk, thisismoney.co.uk, nationwide.co.uk, lloydsbankinggroup.com (image courtesy of telegraph.co.uk)