House prices down 1.4% in January
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House prices fell 1.4% in January, the latest house price index by the Department for Communities and Local Government shows.
In January UK house prices increased by 0.5% over the year but decreased by 1.4% over the month.
The average mix-adjusted UK house price was £208,552.
Average house prices were 0.4% lower over the quarter to January, compared to a quarterly decrease of 0.2% over the quarter to October.
Prices paid by first time buyers were 1.5% higher on average than a year earlier whilst prices paid by former owner occupiers increased by 0.1%.
Nicholas Ayre, a director of buying agents, Home Fusion, says: “The 1.4% decline in January does seem indicative of the direction house prices will go during 2011, namely down.
“At best, the market will remain flat this year, at worst it is heading for further falls, especially in areas where unemployment is rising sharply.
“In the property market right now, the negatives far outweigh the positives and in some areas, especially those overly reliant on public sector jobs, there are very few positives at all.
“Supply has slowed in recent weeks, easing the pressure on prices, but this could change rapidly when interest rates rise. This week’s unemployment data will also have a bearing on consumer confidence and therefore the demand for property.
“As ever, there is a split in the market between the top end, where demand is still strong and mortgage finance achievable, and the lower end, where demand is weak and mortgage finance very difficult to secure.”
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