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House prices stabilising, says Nationwide

By Garnet Roach - garnet@consumerchoices.co.uk

House prices are stabilising across the country, says latest Nationwide report.

UK house prices rose 0.2% in July to £168,731, the latest monthly report from building society Nationwide has revealed.

This left the average house price just 0.4% lower than at the same time last year.

Robert Gardner, Nationwide's chief economist, said: “Stability has been the watchword for the UK housing market over the past 12 months.”

However, he added that demand for homes remained “sluggish”.

“House prices remain relatively high compared to incomes and, together with more demanding deposit requirements, this is dissuading, or at least delaying, some first-time buyers from entering the market,” explained Gardner.

There were only 204,000 housing transactions in the last three months - the lowest level since 2009 - which Gardner said reflected the “uncertain economic climate”.

The number of owner-occupiers also continued to fall, dropping from a 70.9% peak in 2003 to 67.4% in 2009/10, making it the seventh consecutive annual drop, according to the English Housing Survey.

But Matt Hutchinson, director of flat and house-sharing website Spareroom.co.uk, told the BBC that what Nationwide calls “stability” is “little more than a euphemism for stagnation”.

“With the exception of London, property transactions are at severely low levels due to the disconnect between buyers and sellers. Properties are not selling because what buyers are prepared to pay falls well short of what sellers are willing, or able, to accept."