Taylor Scott International News
House prices in the UK are slowing both on a monthly and a quarterly basis, confirming the general decline in value growth, according to the latest index from the Halifax. In the August to October 2014 period prices were 0.8% higher than in the previous three months and this is the slowest quarterly rise since December 2012 when house prices grew by 0.7%. The sharp fall in the quarterly rate from 2.7% in September is largely explained by the 4% monthly rise in prices between April and May dropping out of the three month on three month calculation, according to Martin Ellis, Halifax housing economist. Prices in the three months to October were 8.8% higher than in the same three months a year earlier and based on this measure, annual house price growth has been slowing since the middle of summer after reaching a peak of 10.2% in July. The index data also shows that house prices fell by 0.4% between September and October, the fifth monthly decline in the past year. Home sales are also falling. They contracted for the seventh month in succession, falling to 97,450 in September, the lowest level since October 2013 when they were 95,640. Sales in September were 11% below their recent in peak in February 2014 at 109,530 according to HMRC, seasonally adjusted figures. At the same time mortgage approvals at a 14 month low. The volume of mortgage approvals for house purchases, a leading indicator of completed house sales, fell for the third consecutive month in September, to 61,300. Approvals have now fallen by 20% from 76,500 in January 2014 according to Bank of England seasonally adjusted figures. There are signs of an improved balance between supply and demand. Market conditions, as measured by the ratio of house sales to the stock of unsold properties, reported by the Royal Institution of Chartered Surveyors’ (RICS) monthly survey, eased for the second consecutive month in September as a result of lower sales, according to the latest data. This suggests that a better balance between supply and demand may be emerging. Ellis pointed out that the economy is continuing to grow at a healthy pace and employment is still rising and these factors should support housing demand over the coming months. ‘However, while the chances of an imminent interest rate hike may have receded, a recent Halifax survey found that many borrowers are concerned about the impact a rise could have on their monthly mortgage repayments over the next 12 months. This concern is likely to curb buying intentions,’ he added. It feels like the market has had a small stutter, according to Jonathan Hudson, of London west end agent Hudson Property. ‘While buyers are getting used to the new MMR ruling on mortgage affordability and while some have their eye on the general election in May, I would say these figures represent the mood in the market,’ he said. ‘People are still buying, but only sellers with a reason for moving are accepting… Taylor Scott International
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