October was the sixth month in a row that house prices in the UK have fallen and it seems that in recent months the rate of fall has been increasing, this is according to new figures from Hometrack Ltd.
In September the average cost of a person’s home dropped 0.2%, this is around 3% less than a year ago. Hometrack is a London based company and the figures from them are based on a survey of estate agents. The only month in which the company recorded a growth in home prices was in July last year.
Rising inflation and unemployment have meant that less people are borrowing money and banks are restricting lending. This is causing the housing market to decline and a new report has also shown that businesses are not positive about the economy. The survey of estate agents measured how many people are looking to sell their homes, which is an indicator of demand in the market.
The director of research for Hometrack is Richard Donnell and he is commented, “The concerns consumers have over the economy is beginning to have an effect on house prices, buyers are moving away from the market as they have concerns over the economy and their own finances.”
Business expectations for the economy are measured on an index and in October this fell 22 points and is currently sitting at -15, this is the weakest reading since the end of March 2009.
The employment website Reed has recently issued a report saying that the number of new jobs available is at its highest point for eight months. The same report however showed that the salary expectations are remaining the same as they were eight months ago. Recent data published by the Centre for Economics has said that unemployment will continue to rise for the next five years.