United Kingdom: Downward trend in housing prices continues
December 1, 2010
In November, the average price of a typical property in the U.K. dropped a seasonally adjusted 0.3% over the previous month, according to data collected by the mortgage lender Nationwide Building Society (NBS). The reading followed on the 0.7% price drop recorded in October and thus continued the virtually uninterrupted downward trend seen since June. As a result, housing prices are only 0.4% higher than a year ago (October: +1.4% year-on-year), and have fallen by 12.2% compared to the peak reached in October 2007. Home prices began to recover in March 2009, well ahead of the overall economic recovery. However, the rebound stalled in June, as the government began phasing out the stimulus measures, in particular the stamp duty holiday. Going forward, home prices are not expected to make a strong comeback, as credit remains tight and the labour market is likely to remain weak in the coming years.