House prices slide 0.9pc

Yuan Phoon

May 3, 2012

House prices slid 0.2% on a seasonally adjusted basis compared to March 2012.

This is the fourth time in five months that prices have declined according to Nationwide’s figures.

Robert Gardner, chief economist at Nationwide, said: “Much of the recent softness in measures of housing market activity and house prices is likely to relate to the expiry of the stamp duty holiday in late March.

“This provided a temporary boost to house prices in early 2012 as buyers brought forward purchases that would otherwise have taken place later in the year.

“This effect should fade in the months ahead and measures such as the government’s NewBuy scheme should provide some support to buyer demand.”

Nicholas Ayre, director of buying agents Home Fusion, said: “While the end of the stamp duty holiday has been a factor in driving prices down, it’s by no means the main factor.

“As Bill Clinton once said, it’s the economy, stupid. Moving forward, it’s hard to see prices getting out of the rut they are currently in. Mortgage criteria and products are tightening, as seen with the Co-op’s withdrawal from interest-only. It’s getting a lot harder to buy.

“The Nationwide are there or thereabouts when they say prices will stagnate over the course of the next year. My feeling is that this is the most positive scenario. It’s blissfully naive to think NewBuy will rescue the property market, where the problems are structural and macro.”

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