Figures from the Land Registary have shown that the North East of England has seen the largest drop in house prices, falling by 8.8% in the first six months of this year. A fall in house prices has been the case for all regions of England and Wales with the exeception of London which has seen an increase of 1.3%.
The biggest drop has been in the prices of apartments and maisonettes.
In July this year the average price of a home in England in Wales was £163,049. Although this is 1.3% higher than the previous month, it is 2.1% less than the average cost of a home in July 2010.
In the North East of England, the average price of a home was £101,143 in July meaning that there had been a drop in cost of 2.3% since the previous month.
The Council of Mortgage Lenders recently conducted research which depicted that 827,000 mortgages were in negative equity which, for a lot of borrowers is a consequence of falling house prices. Although this figure is not as high as it was in the 1990s it is still a serious issue for those who live in an area where house prices are falling and may want to sell their home. This is especially true if they bought their house during the boom when house prices were rocketing.
The chief executive of Marsh & Parsons, Peter Rollins, expressed that if people want to really understand the condition of the housing market they should look at the number of houses being sold instead of the prices. This figure is not promising as it shows a 10% decrease in sales since this time last year. He explains that it is the difficulty first time buyers are experiencing trying to successfully apply for a mortgage loan that is responsible for fewer sales and increasing prices in London.
At the same time, the Home Builders Federation has stated that less Uk homes are being built now than in the last 90 years. It believes this is due to fewer planning permissions being given and that the situation is only worsening.
In contrast, the Local Government Association reported 80% of applications for major residential projects were successful between March 2010 and March 2011 and further building will be encouraged by a new planning system due to be implemented.
Last week however, the Centre for Economic and Business Research predicted that the Uk would see a 4% rise in house prices over the next 4 years due to not enough new homes being available.
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MAAT and ICPA accountant, with a passion for making accountancy and bookkeeping accessible. Other interests include cloud-based software development for web and mobile access, keeping fit, reading, and entrepreneurship.