Don't bet the house

1 June 2009 By George Hay Follow @gfhay

Several indices suggest house prices are stabilising. But the signs aren t strong enough to call the bottom of the slump with certainty. That would require a turn in the labour market and improved mortgage financing for firsttime buyers. Both look some way off.

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UK house prices rose by 1.2% in May, according to the index compiled by Nationwide building society. The increase the second in three month – means prices are now 11.3% down on the same period last year and have fallen 17% in total since their 2007 peak.

The Halifax building society's figures for May are yet to be published. It registered declines of 1.7% in April and 1.9% in March, but forecasters predict a milder monthly fall of 0.5% for May. That would mean a yearonyear fall of 17.1% in the three months to May.

The Land Registry's latest figures suggest house prices fell 0.3% for April, compared to falls of 2.1% and 0.4% in February and March. It sees values as down 16.2% on this time last year.

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