House prices back to 2003

This Is Money13 April 2012

HOUSE prices fell 0.2% in June, making it a full year of falls and taking prices back to 2003 levels.

The latest survey by UK property website Hometrack showed the average house price dropped to £161,600 during the month, the lowest it has been since December 2003.

House prices are now down 3% in the past 12 months from a peak of £167,000 in June 2004.

Hometrack housing economist John Wriglesworth said: 'The market over the last few months has looked like it was about to come up for some fresh air, with house prices coming tantalisingly close to turning positive. However, June's price fall signals a stall in the road to recovery.'

The report is a blow to the housing market after a number of recent surveys pointed to a stabilisation of property prices. The three previous Hometrack surveys recorded consecutive 0.1% falls in price.

The report also highlighted a fall in the number of buyers looking for new homes and an increase in the time it takes to sell property. The average time it took to sell a home increased to 7.6 weeks, up from 7.4 weeks last month and 4.2 weeks a year ago.

'Longer times to sell and higher discounts achieved from the asking price all point towards a weakening market,' said Wriglesworth. Sales prices as a percentage of asking price dipped slightly from 93.6% to 93.5%.

Only one county, Northumberland, reported an increase in house prices, with Hampshire, the Isle of Wight, Kent and North London suffering stagnation.

Norfolk reported the largest fall, down 1%, followed by Avon, North Lincolnshire, Wiltshire and South Lincolnshire.

Wrigleswoth added: 'The only good news is an upwards trend in sales agreed and a general expectation of lower interest rates before the end of the year. These could help boost confidence and ensure prices stability.'

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