House prices have fallen consistently over the past 15 months, says the new survey from Hometrack – falls of 0.9% were recorded in December and an annual average fall of 8.7% for 2008. They are also predicting that prices will fall a further 12% in 2009.
As Richard Donnell from Hometrack commented: ‘The onset of recession and the prospect of rising unemployment over 2009 will continue to dampen confidence and in turn demand which will inevitably lead to further house price falls over the next 12 months. With mortgage lending set to remain constrained so the primary drivers of housing are likely to be bargain hunting cash buyers and investors looking for high yields, these together with low loan to value borrowers and households that simply need to move.
‘Overall we expect sales volumes to decline a further 12% over 2009. Over December the survey shows that prices were down across 63% of the country, a figure that has fluctuated between 50% and 75% over the final half of the year. On a regional basis the greatest price falls have been seen in southern England where supply is most constrained and where prices are sensitive to changes in demand which has fallen off something of a high base,’ added Mr Donnell.