Press
Mortgage Strategy 2nd Aug 2004
Will house prices fall or is this just a blip?
Hometrack's latest monthly survey covering July shows that house prices have fallen for the first time this year.
The figures show a 0.1% fall in prices, following a steady reduction in house price inflation over the past six months. Hometrack's latest monthly survey covering July shows that house prices have fallen for the first time this year.
The figures show a 0.1% fall in prices, following a steady reduction in house price inflation over the past six months from the peak of 0.9% seen in February.
Recent interest rate rises are thought to have contributed to the house price fall, with people refusing to pay over the odds for property.
So, Mortgage Strategy asks: "Do you think this is the start of a trend of falling house prices this year or is it just a blip?" John Stewart, PMI Independent Financial Advisers I am not at all surprised. It's about time. House prices will fall in the areas that saw highest growth previously. London will probably be one of the first areas to experience the change. But I think it will be a soft landing, rather than a harsh fall. We will not see price falls as dramatic as those in the late 1980s.
James Carter, Virtue Financial
This fall may be part of a trend, particularly considering the economic data at the moment and the prevailing high interest rates. Places in the North will probably see the biggest price falls. In places like Middlesborough prices are ridiculous and don't reflect people's wages.
Mark Osland, Fidelius
It is good to see a realistic assessment of house prices. I think they have been going steadily down since May. There is certainly room for prices to stabilise. Some house prices in London look particularly ludicrous. I think if there is to be a fall then it will be localised. There is no sign of a crash but house prices are getting a bit more realistic.
John Burnard, New Life Finances
I think that the market is going to stabilise and we will not see any more house price falls. At the moment, buyers are saturating the market. I reckon there will be some fallback but there will not be a collapse.
Paul Fincham, Halifax
Our own economic research, which was published on June 22, showed that there was a 1.2% increase in house prices in June. If you compare this year with the previous one, house prices are going down. We expect to see signs that the housing market is slowing down.
Carl Melvin, Millbrae Financial Services
House prices in Scotland are still fairly buoyant. People are not prepared to pay over the top for houses because of the recent interest rate rises. Reality has come into play and I think that is a healthy thing.
Lawrence Hayward, Moodybrook Financial Services
I think over the next few months the housing market will soften a little but to what extent will not be known until the end of the year. The South will benefit more than the North in the long-term. There are small pockets in the North that have got high house prices.
Brian Lentz, Portfolio Insurance Consultancy and Mortgage Broker
If there are any more falls they will be area-specific. Everyone has been predicting a price fall for some time and it has not happened. I don't think they will increase again, but I do not think they will go down either.
June Williams, Clifton Associates of Bristol
In Bristol, house prices seem to have hardened but not necessarily dropped. Only the sellers who have asked for unrealistic prices have found they have had to drop their prices. People are starting to realise that when the estate agent gives them three valuations, it is often the lowest one that is the most realistic.
Eddie Smith, PMI Europe
The latest figures from Hometrack will be food for the scaremongers. Reality is somewhat different. Houses are overvalued and falling house prices in some parts of the UK could mean the end of the boom but not the beginning of the bust.