Halifax: Modest decline in house prices signals price stagnation for coming year

Julian Harris
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HOUSE prices dropped slightly in the final three months of the year, according to a Halifax study released yesterday.

“Prices were 0.9 per cent lower than in the previous quarter,” said Halifax economist Martin Ellis.

“This rate of decline is significantly less than the quarterly falls of five to six per cent during the second half of 2008,” he added.

The group said it expects limited change in house prices during 2011.

The Bank of England recently revealed that mortgage approvals edged up to 48,019 in November,

Yet prices across the year fell by 3.6 per cent, according to the Halifax data, and some economists fear a further decline.

“House prices have around another seven per cent to fall,” commented Howard Archer of IHS Global Insight. This would see the average house price fall to £152,536 this year, he said, down from 2010’s peak of £169,484.

However, the market for properties worth over £1m is more robust, according to Investec bank.

Sales at the top end increased by 44 per cent between August 2009 and August 2010 according to official figures, Investec said yesterday.

“London will continue to be viewed by international buyers as a safe long term investment,” added Andrew Ellinas of property consultants Sandfords.