House prices edge higher at end of 2010
According to the latest Halifax House Price Index, the annual change in house prices was also 0.4%, with the average house price in December 2010 falling to £162,763.
Commenting on the figures Martin Gahbauer, Nationwide’s chief economist, said: “The seasonally adjusted price index for a typical UK property rose by 0.4% month-on-month in December, after having posted declines in the previous two months. The three month on three month rate of change – which smoothes out the monthly volatility of house prices and is a better indicator of the recent trend – rose from -1.3% in November to -1.0% in December and is still consistent with modestly declining house prices.
“For 2010 as a whole, house prices posted an unremarkable gain of 0.4%, as most of the price increases from the first half of the year were reversed during the second half. The essentially flat outcome for the full year is in line with expectations.
“When house prices are trending down only modestly rather than decisively – as has been the case in recent months – it is not unusual to a see a mixed pattern of monthly declines and occasional increases.
“Despite December’s increase, house prices have fallen in four out of the last six months and it would be premature to suggest that the recent downward trend has been broken on the basis of one month’s figures. However, the December figures do underscore the fact the current downtrend is only very modest, particularly when seen in comparison to the second half of 2008. During this period, the three month rate of change dropped to as low as -5.5%.”