Halifax figures Point To a House Price Crash

September 2010 may mark the start of a house price crash as the Halifax has reported a fall in house prices of 3.6% in that month.  This is the biggest monthly fall in prices the Halifax has reported since it began releasing these figures in 1983.

This has fuelled speculation that we are on the edge of a substantial price crash further hampering the economic recovery.  The value of the pound immediately dropped on this news.

However, it is too early to conclude that September’s fall represents the beginning of a sustained period of declining house prices according to Martin Ellis, housing economist with Halifax.  

He added: ‘Looking at quarterly figures – a better measure of the underlying trend – house prices in the third quarter of 2010 were 0.9% lower than in the second quarter of 2010. This rate of decline is significantly slower than the quarterly changes of between minus 5% and minus 6% that were seen in the second half of 2008.’

‘Prospects for the housing market remain uncertain. Earnings growth is expected to be very modest over the next year, tax rises are on the way and more people are putting their homes on the market. These will all be constraints on the market, dampening house prices.

‘On the positive side, we expect interest rates to remain very low for some time, which will underpin the improved affordability position for homeowners.’

Related posts:

1. House Prices Fall In May
2. Mortgage Lending Rises In March 2010
3. House prices falling again
4. Nationwide – 1% Drop In House Prices Feb 2010
5. Repossessions on the rise?