The last few months’ house price falls have wiped out the gains from the previous year, leaving Britain’s home owners fearing a huge double dip in property prices. New figures, released today, have shown a further drop in November triggering concerns among economists.
The figures, released by Nationwide, show a 0.3 per cent drop in house prices in November, which follows a 0.7% drop in October. On average houses are losing £40 a day in value.
With the average house now worth £163,398, property prices are only showing an average increase of 0.4% on this time last year, and prices haven’t risen in the last 6 months.
Economists fear a significant drop in house prices through 2011, but Nationwide disagreed. They explained that there was no reason to believe that the drop in house prices would accelerate. Their quarter on quarter index showed a slight improvement during the month.
Nationwide’s chief economist, Martin Gahbauer, said: “There is little evidence to suggest that house price declines are likely to accelerate in the months ahead.”
“Much of the weakness in property values since the spring has been driven by a return of sellers to the market, following unusually low levels of property for sale in 2009 and early 2010.”
“However, there is little to indicate that these sellers need to achieve a sale urgently for financial or economic reasons, which means that the downward pressure on house prices is only modest.”
The last quarter showed only a 1.3% drop, compared with 1.5% the quarter before, showing that house price falls are actually slowing. With many people gearing up to sell their homes in the New Year, the housing market could stabilise again in the coming months.