Tuesday, April 13 2004

UK house price inflation fell for the first time in months, says the Office of the Deputy Prime Minister today. According to its figures for February, the rate of inflation fell slightly to 12, from 12.1% in January.

This puts the average house price now at £160,937 down from £162,559 the previous month.

The report also noted strong growth continuing in Scotland, Wales and Northern Ireland, although England, particularly in the south, did not display such growth.

However, as opposed to house price figures from big mortgage lenders like Halifax and Nationwide, the figures from the ODPM’s office are not seasonally adjusted, so may be accounted for by the seasonal slowdown around the start of the year.

Meanwhile the man labelled ‘Dr Doom’ after prematurely forecasting the burst of the dot com bubble has told the Financial Times today that he expects a dramatic crash in house prices to come soon.

‘Everyone is hoping for a soft landing but no, we don’t have soft landings in things like this, ever,’ he told the FT.

‘You show me a market with a parabolic rise followed by a soft landing- it just doesn’t happen. The only way you could stop that is by Government interference but this market is just too far gone for that,’ he told the paper.