Nationwide: House prices down nearly 15%

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by Kay Murchie

According to the Nationwide, house prices in the UK have now fallen for the twelfth consecutive month.

The building society’s latest survey has revealed that property prices fell by 1.4% in the last month, taking the annual rate of fall up from 12.4% to 14.6%.

As a result, £27,000 has been wiped off the value of a property, taking the average cost of a home to £158,872.

Meanwhile, the building society said the number of completed housing sales are now at their lowest level since 1974.

According to Fionnuala Earley, Nationwide’s chief economist, the number of completed house purchase transactions as a proportion of the total stock of mortgages is now at its lowest ever level since the series began 34 years ago.

She added that a recession and continued financial market instability will no doubt have an impact on the housing and mortgage markets, and will undoubtedly affect the pace of recovery in house prices.

Earlier this week, the Centre for Economics and Business Research (CEBR) predicted that house prices will fall in value by 25% from their peak of last summer.

The organisation believes that house prices will not recover to the levels they peaked at in 2007 until 2013.

As a result of its forecast, around 2.5 million homeowners could face negative equity.

Last week, credit ratings agency, Standard & Poor’s, said tumbling house prices are pushing 60,000 homeowners each month into negative equity.