Home prices slump despite increase in sales

Published by Max Salsbury for 24dash.com in Housing and also in Finance

Average UK house prices fell by 0.1% in October, despite a 9.2% rise in agreed sales.

According to Hometrack, however, October's price drop represents the lowest rate of price falls for two years.

The property analytics company's monthly national housing survey also recorded a slight rise in the amount of property sales that achieved their asking price, from 93% throughout August and September to 93.2% in October.

Hometrack asserts that price rises earlier in the year and a slowdown in the rate of price falls in northern regions explain the improvement in the year-on-year rate of growth.

Richard Donnell, Director of Research at Hometrack, said: “House prices continued to drift lower in October, falling by -0.1%. This is despite a 9.2% jump in sales agreed and a small increase in new buyers registering with agents over the month.

"However, taking a broader view of the market, year-on-year house price inflation is currently registering the lowest level of price falls for two years (currently -0.4%). This is down to a strong spring market in 2012 and a steady firming in underlying pricing levels in the north of the country – an area where values over the last 12-18 months have come under sustained downward pressure.

"In the short term we expect the current trends to continue with demand likely to slowdown in the run up to the year end with agents looking to push through as many sales as possible.”