Monday, January 10, 2011
Halifax house prices down 1.3%
Posted by David Smith at 08:30 AM
Category: Thoughts and responses

House prices ended 2010 on a weak note, according to the Halifax (part of Lloyds Banking Group), with prices down 1.3% in December, for a fall of 0.9% in the final quarter and 1.6% (on a three-monthly basis) on a year earlier. There's some pretty strange analysis around in the run-up to the Bank of England's monetary policy committee meeting this week. One clear fact is that the housing market remains very soggy.

This is Martin Ellis, the Halifax's chief economist:

"Prices in the final three months of 2010 were 0.9% lower than in the previous quarter. This rate of decline is significantly less than the quarterly falls of 5-6% during the second half of 2008. House prices fell by 1.3% between November and December.

"Looking forward, we expect limited movement in house prices during 2011 but with the risks on the downside. Interest rates are likely to remain very low for some time. This will continue to support a favourable affordability position for those entering the market and limit financial pressure on existing homeowners to sell. Current signs that homeowners are becoming more reluctant to sell would, if continued, help reverse the imbalance between buyers and sellers. Nonetheless, uncertainty about the economy, weak earnings growth and higher taxes could put some downward pressure on demand."