The Halifax House Price Index yesterday revealed that house prices in the UK are falling again, this time by 2.3 per cent.
There was a short-lived rise in January of 2 per cent, which economists had viewed with some scepticism. Taken as an aggregate over three months, combined figures for last November, December and January showed a decline of 3.6 per cent.
The present decline has seen UK house price drop to the same level that they were back in 2004.
Earlier, economist Colin Ellis, of Daiwa Securities said: ?Many housebuilders are in intensive care as they wait for confidence and sales to return to the housing market , which will probably require some degree of price stabilisation.?
For the prospective home-buyer with some capital behind them, this could be a great time to enter the market. House prices have tumbled to their lowest levels for five years and interest rates are at a record low.
However, with many people struggling to put together the required capital to raise a deposit, securing a loan is increasingly difficult. According to a Citi economist, Michael Saunders, house prices could drop ?by a further 10 per cent and perhaps 20 per cent from here.?
The Royal Institution of Chartered Surveyors (RICS) explained that the European housing market has suffered due to lower demand and an excess supply of properties.
Property index expert Michael Ball said that sharp decreases in mortgage lending and the general global recession are the causes of the present housing market crisis.
