House prices fall for first time in ten months

It has been reported that property prices in the UK have fallen for the first time in ten months, with the January lull in the property market driving property prices down.

The lull that was seen in January resulted from a reduction from transactions because of the end of the stamp duty holiday coupled by freezing weather conditions that forced people to stay at home. The figures were released recently by the High Street banking giant, Nationwide.

According to the Nationwide house price index property prices have fallen by 1 percent, and on the average property price this equates to a fall of just over £2000.

Over recent months property prices across the UK have been increasing following a very turbulent couple of years, and the sudden property price fall may come as a disappointment to many homeowners, although many industry experts have suggested that this is a temporary lull and that there is likely to be a spring bounce over the coming months.

Officials from Nationwide said that it was a combination of the end of the stamp duty holiday coupled with the terrible weather conditions that were seen in January that resulted in the drop in property prices.

Many had been hoping that house price inflation would hit double digits this month, having reached 9.2 percent year on year compared to 17.6 percent down year on year during the same period in 2009. However, this most recent fall means that those that were hoping for double digits will be disappointed.

The chief economist from the Nationwide stated: ”There is evidence from a range of indicators that the market may have lost momentum in early 2010 as the stamp duty holiday ended and house hunters were obstructed by the icy weather.”

”This drop in demand seems to have fed into agreed prices during February. At this stage, it is difficult to gauge how much of the drop in housing activity is attributable to one-off factors and therefore whether February’s fall in prices is just a temporary blip or the start of a new trend.”