Halifax reports 2.4% fall in house prices in May
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by Lin Freestone
The Halifax, the UKâ€™s biggest mortgage lender, reports that UK house prices dropped by 2.4% in May 2008.
The price of the average home fell to Â£184,111, the biggest annual fall in prices since 1993.
Nationwide Building Society has already revealed the results of its own study, which concluded that there was a 2.5% fall in prices during May.
News of the latest fall in house prices came on the same day that the Bank of England decided to leave interest rates unchanged at 5%.
Estate agents and construction firms, together with many other business sectors in the UK, have been calling for a cut in interest rates to help the slowdown in the economy.
Economists from the Halifax concluded that the decline in prices is caused by the difficulties created for potential house purchasers by the rapid rise in house prices in the last few years, a squeeze on spending power and the reduction in credit availability.
The downward pressure on house prices coming from stretched buyer affordability and tighter lending conditions are now biting hard.
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