Residential landlords in England and Wales saw house prices fall by two percent in December. According to the latest figures from Land Registry the average house price is now £158,946 representing an annual decrease of 13.5 percent.
But another property company says there has also been a 30 percent increase in rentals activity.
In London the average price fell 12.9 percent annually to £307,071 – a level similar to prices experienced in late 2006. The West Midlands saw the most significant monthly fall in prices at –3.6 percent.
Other figures recently released by Nationwide revealed that there had been little change to recent house price trends in the New Year. Its figure of £150,501 for the average price of a typical house is slightly lower than the Land Registry figure.
A statement from the building society said: “The price of a typical house fell by a further 1.3 percent in January, as the deepening economic recession and financial market turbulence continued to weigh on housing market sentiment and activity.
“January’s decline leaves the average price of a typical house at £150,501, down 16.6 percent from 12 months ago. The 3-month on 3-month rate of change, a smoother indicator of the short-term trend in prices, improved for the fourth consecutive month from -4.2 percent in December to -4.0 percent in January.
“However, it is too early to say that this marks the start of a sustained improvement in the short term trend.”
In Winkworth’s recently released Property Market Predictions for 2009, Dominic Agace, MD of the company’s Franchising arm, said: “We have seen a 50 percent reduction in sales transactions from 2007, however, there has also been a 30 percent increase in rentals activity, as buyers watching the economy unfold are choosing to rent while they await the bottom of the market.
“Sales prices have also gone down by 20 percent, compared to last year. I believe prices will fall a further 5-10 percent (following an historic 30 percent drop in price during recessions).
“In my opinion, we have seen the bottom of the market in terms of volume. Next year, I don’t foresee a sudden uplift in volume; however, reduced interest rates will start to peg the bottom of the market.”
