HOUSE PRICES slipped in September, according to data released by Halifax yesterday, adding to the evidence suggesting a weak housing market.
The average UK house price slipped 0.4 per cent during September to £159,586, the Halifax house price index showed, with analysts putting the decline down to poor fundamentals.
“The generally weak economic climate remains a significant constraint on housing demand,” said Halifax’s Martin Ellis.
Last month’s small fall was the third consecutive monthly drop, and capped off a quarterly 0.5 per cent decline, and a total yearly dip of 1.2 per cent.
But mortgage payments remained at their post-crisis low levels: from a peak of 48 per cent of disposable income in the third quarter of 2007 they slid to 26 per cent in the third quarter of 2012.
Ellis said this low level provided support for house prices, ensuring they didn’t fall further.
Analysts said the slumping market wasn’t a good advert for Funding for Lending (FLS).
“The jury is still out on FLS and it would be good to see some data as to exactly who is borrowing what under the scheme,” said SPF Private Clients boss Mark Harris.
“One lender recently voiced its concern...about the perceived stigma attached to taking advantage of the funds available, fearing it gives the wrong message to customers,” Harris added.
In light of this weak picture, economists predicted that prices were likely to stay flat past the end of the year.