The housing slide continues. The Halifax, the UK's biggest mortgage lender, has reported that prices fell 1.1 per cent in November. This is the first time in 12 years that the lender has recorded three consecutive monthly falls.
The data tallies with recent surveys from Nationwide building society and the Royal Institution of Chartered Surveyors, both of which showed prices going into reverse. In addition, official figures show that the number of new mortgage approvals a good indicator of activity in the property market has fallen sharply since the summer.
However, the Halifax, like other housing industry bodies, continues to pour cold water on the notion that the full-blown property crash now happening in the US is also underway here. "Strong market fundamentals, a structural housing supply shortage and pent-up demand from a large number of potential first-time buyers will support house prices, preventing a sustained and significant fall," said Martin Ellis, chief economist at the Halifax.
Since house prices started to fall in September, up to 5,000 has been shaved off the average cost of a home in the UK, the Halifax added. As a result, the average price tag has stepped back from the 200,000 threshold and now stands at just under 195,000. Nevertheless, UK property prices are still 6.3 per cent higher than they were 12 months ago.
But there was good news for homeowners last Thursday when the Bank of England cut interest rates by 0.25 per cent to 5.5 per cent. Immediately, the Halifax responded, trimming its standard variable-rate mortgage by an identical 0.25 per cent, reducing repayments on a 200,000 mortgage by around 30 a month. Other lenders are expected to follow, though experts reckon that is unlikely to halt the slide in prices in the short term at least.