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UK house prices falling sharply UK house prices falling sharply
(20 minutes later)
UK house prices declined by 2.2% in December, according to the latest survey by the Halifax. UK house prices declined by 2.2% in December, the Halifax has said.
The monthly fall brings the average price of a UK home down to £159,896. Compared with December 2007, house prices slumped by 16.2%. The monthly fall brings the average price of a UK home down to £159,896, a level last seen in August 2004. Prices were down 16.2% from December 2007.
The figures came as the Bank of England said mortgage approvals fell in November to at least a nine-year low. The Halifax added that against earnings homes were now more affordable than at any time since April 2003.
Approvals totalled 27,000 in November. It was the lowest figure since the series began in January 1999. Its latest figures came as separate data from the Bank of England said mortgage approvals fell in November to 27,000 - at least a nine-year low.
Continuing pressures on incomes and the availability of mortgage finance are expected to exert future downward pressure on the market over the coming months Martin EllisHalifax chief economist Nationwide ends tracker rate cuts
This was the lowest figure since the series began in January 1999.
SubduedSubdued
The Halifax said house prices were likely to continue to fall for some time.
"Continuing pressures on incomes and the negative impact of the dislocation of the financial markets on the availability of mortgage finance are expected to exert future downward pressure on the market over the coming months," said Halifax chief economist Martin Ellis.
In monetary terms, mortgage lending rose by £740m in November, but that was still less than a tenth of the amount seen in the same month in 2007.In monetary terms, mortgage lending rose by £740m in November, but that was still less than a tenth of the amount seen in the same month in 2007.
The figures are the latest indication of the extent of the housing downturn.The figures are the latest indication of the extent of the housing downturn.
The latest fall in mortgage approvals is likely to increase pressure on the commercial banks to start to raise lending levels.The latest fall in mortgage approvals is likely to increase pressure on the commercial banks to start to raise lending levels.
These are still subdued as a result of the financial crisis, despite efforts by the Bank of England to help the banks improve their liquidity.These are still subdued as a result of the financial crisis, despite efforts by the Bank of England to help the banks improve their liquidity.
However, with house prices falling in recent months, and people waiting to see whether mortgages will get significantly cheaper, activity in the mortgage market is likely to remain subdued for sometime.However, with house prices falling in recent months, and people waiting to see whether mortgages will get significantly cheaper, activity in the mortgage market is likely to remain subdued for sometime.
The number of mortgages approved, but not yet lent, is a good indicator of medium-term trends in lending.The number of mortgages approved, but not yet lent, is a good indicator of medium-term trends in lending.