House prices fall at fastest rate since February

House price falls accelerated in October, occording to the latest data from housing data firm Hometrack.

The company said prices were now falling in more than a third of postcode districts in the country, a big increase on September, when prices fell in just 25% of places. In contrast just 6.5% districts saw a rise in prices in October.

In total the firm said prices fell by 0.2% over the month, faster than the 0.1% falls seen for the last five months, and the biggest fall since February. This means prices are now down 2.8% year on year.

In addition the company said that price rises have now ground to a halt in London, following seven months of continuous rises.

The number of new buyers registering with agents fell again, albeit at a slower rate than in September, and the average amount of time for a home to be on the market increased to 9.8 weeks.

Richard Donnell, director of research at Hometrack, said the figures showed that growing consumer concern over the outlook for the economy was beginning to impact directly on house prices. He said: “Above average price falls in the West Midlands, East Midlands and the North East, together with static prices in London - where average prices have risen consistently for the past 7 months - lie behind the increase in the headline price fall.

“Above average price rises in London have flattered the headline rate of growth over recent months and a slowdown in the capital will have a knock-on impact on the scale of price changes nationally in the months ahead.

“The increase in price falls comes on the back of a continued lack of potential buyers. The evidence is clear that buyers are drifting away from the market in the face of weak consumer confidence and concerns over the prospects for the economy and their household finances.”