Only halfway there

2 April 2009 By George Hay Follow @gfhay

By one measure, UK house prices could be near fair value. A survey showed them rising in March for the first time in 17 months. But housing slumps usually overshoot, and need consumer optimism to turn. There s not much of that around. There could be room for another 20% fall.

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The price of a typical UK house increased in March for the first time since October 2007, according to Nationwide building society figures released on April 2.

Prices rose by 0.9% during the month, bringing the average price of a typical house to £150,946.

However, the findings were contradicted by the Halifax building society, which said on April 3 that prices had fallen 1.9% in March.

UK house prices have now fallen approximately 20% since reaching a peak of £186,000 in Autumn 2007, according to Nationwide.

Firsttime buyers can now get a two year fixedrate at 4.5%, compared to 6.4% at the end of 2007, according to the Bank of England. The central bank also estimates that the average deposit required by lenders has increased from 10% to 24%.

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