Halifax report 1.9% fall in March house prices

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by Kay Murchie

According to the Halifax, house prices in the UK fell by 1.9% in March, compared with February.

The announcement comes just 24 hours after the Nationwide’s house price index revealed a 0.9% month-on-month increase in the average cost of a home. The Nationwide puts the average UK home at £150,946.

Meanwhile the Halifax, which is now part of Lloyds Banking Group, puts the average UK home at £157,226 - £30,000 less than a year ago.

Halifax housing economist, Martin Ellis, said that conditions in the housing market would remain tough for the remainder of 2009.

Mr Ellis explains that the lack of mortgage finance, low consumer confidence and rising unemployment due to the recession are “likely to exert downward pressure on the market over the coming months“.

However, many economists have said there are signs that the housing market may be stabilising. Richard Donnell of property website Hometrack said there is “growing optimism among estate agents”, while the Royal Institution of Chartered Surveyors has reported a sharp rise in new buyer enquiries.

Earlier this week, the Bank of England said mortgage approvals for house purchases were higher than expected for February. The number of mortgages approved grew to 38,000 in February, up 6,000 compared with January and represented the highest figure since May last year.

However, many experts still express caution since recent measures implemented by the Bank of England, including record low interest rates and quantitative easing, would take time to filter through to the housing market.