Slip and slide

29 October 2007 By Ian Campbell

UK house prices fell by a tiny amount in October, and by a little more in London and other expensive markets. But vanishing buyers and dropping asking prices suggest the market s slip could easily turn into a slide.

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House prices fell by 0.1% in October, the first price fall for 2 years, according to the latest national housing market survey from Hometrack. October's small decline follows two months of zero growth in prices and reduces the annual rate of growth to 4.4%. Average prices were down by between 0.1% and 0.2% in October across all regions of the UK except for the West Midlands where values remained unchanged.

Richard Donnell, Hometrack's Director of Research, said, The fall in prices over October is not unexpected. After several months of weaker buyer confidence, falling levels of demand and declining sales volumes, prices were bound to be affected. We expect further small price falls in the months ahead but these are likely to remain limited as there remains no evidence of any increase in the supply of homes for sale. If anything the current uncertainty appears to be resulting in a decline in the numbers of homes coming to the market which is likely to support underlying prices in the coming months.

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