Property data firm Hometrack said on Monday that property prices in December have fallen for the sixth straight month and on year-on-year basis, prices have declined marginally by 1.6% over last year.
Prices fell by 0.4% in December over the previous month, half of that witnessed in November. The company asks estate agents to set achievable targets for selling homes to measure price movements. Results indicate that 71 percent of areas of the whole of UK witnessed a fall in price in the course of the year.
Agreeing with an earlier report published by the Royal Institution of Chartered Surveyors, Hometrack said prices may fall by another 2 percent in 2011.
Although Hometrack’s finding does not take into account the cyclical nature of property prices, it certainly is in sync with other reports that suggest sentiments will be negative in 2011 on the back of lower government spending and a struggling economy.
In an effort to narrow its budget deficits, the British government has embarked upon an unprecedented spending cut. Economists estimate that close to 500,000 government jobs may be lost in the next four years on account of massive expenditure cuts.
“Weak demand and falling supply will be the defining features of the market, Lack of mortgage finance and falling consumer sentiment are trends that will continue into 2011”, said Hometrack in its report.
The average time taken to sell a property in December was 10 weeks, the longest since April 2009, the survey found. Residential property supply increased by 24 percent while demand shrank by 7 percent throughout 2010.