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House prices fall for second month in August
02/09/10
Edited by Andy Jowett.UK house prices declined for the second consecutive month in August, the latest figures from Nationwide has shown.
The mortgage lender said the average value of a residential property fell by 0.9 per cent compared with July to stand at £166,507.
August's drop in prices follows a 0.5 per cent decline in the previous month.
Prices were 3.9 per cent higher than August 2009, but annual inflation had slowed from July's figure of 6.6 per cent and 8.7 per cent in June.
Nationwide chief economist Martin Gahbauer said the quarter-on-quarter rate of change in property values, which is seen as a more reliable indicator of medium-term trends, dropped from 1.2 per cent to zero in August.
"Unless house prices bounce back strongly in September, the three-month rate of change will turn negative next month," he added.
Mr. Gahbauer added that part of the decline in prices is down to the recent increase in the supply of properties for sale, which has given potential buyers a wider selection of homes to choose from and more power to haggle over prices.
Earlier this week, the Bank of England said around 340,000 mortgages were approved for house purchase during the first seven months of 2010, a figure the Royal Institution of Chartered Surveyors described as "well down on historic norms".
