Nationwide house prices fall

Sarah Davidson

October 2, 2012

Robert Gardner, Nationwide’s chief economist, said: “UK house prices declined by 0.4% in September, after recording a 1.1% rise in August.

“Monthly price changes have been impacted by a number of one-off factors this year, such as the ending of the stamp duty holiday that cannot be controlled by the usual process of seasonal adjustment.

“For this reason the annual rate of house price change is a better guide to the state of the market at present. On that basis, the housing market remains fairly stable, with prices 1.4% lower than September 2011.

“Looking forward, policy measures such as the Bank of England’s Funding for Lending Scheme should provide support for activity in the housing market by ensuring the availability of credit and lowering its cost.”

Independent buying agent Gabby Adler said the fall was unsurprising given poor confidence in the wider economy.

But she added: “With transactions at such low levels, it is very hard to gauge a true picture for property values and the picture may be far better, or indeed worse, than Nationwide is saying.”

Russell Quirk, director of low cost estate agents eMoov.co.uk, said the property market is “running on empty and it’s skewing the data” from one month to the next.

He added: “1.4% down on a year ago is probably a decent reflection of the overall market, although some areas are clearly performing far worse than others. Generally speaking, the South is proving more resilient than the North.

“London continues to defy economic logic. To be just 2% below its peak in a paralysed economy is preposterous.”

Quirk said he was less confident than the Nationwide that the Funding for Lending scheme will have a major impact.

“Yes, it may make credit more available and cheaper but will it get through to the people who need it? Cheap and available is idle chatter if it’s not getting through to higher loan to value borrowers,” he added.

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