Nationwide: House prices down 1.7%

Friday, 4 April 2008 11:41 AM

The average price for a property in the UK has fallen by 1.7 per cent over the last three months, according to the latest Nationwide house price index.

Annual growth stood at just 2.2 per cent in the first quarter of 2008, showing a sharp drop from the figure of 6.9 per cent recorded in the final quarter of 2007.

However, the most dramatic slowdown was recorded in Northern Ireland, where the annual rate of change fell from 24.2 per cent to -3.4 per cent over the same period.

Yet, this still leaves average prices more than £15,000 higher than at the end of 2006 - following sustained increases in property prices over the last two years.

Scotland, in contrast, has seen prices increase by 6.3 per cent over the last year, although they dropped by 0.1 per cent over the last three months.

"The first quarter figures clearly show Scottish house prices as the most resilient in all of the UK," explained Fionnuala Earley, Nationwide's chief economist.

"Although prices here edged down slightly from the previous quarter, Scotland has now overtaken London in the league table of annual house price inflation.

"In the past we have alluded to the fact that mortgage affordability in Scotland is not as stretched as in other parts of the UK, and this is likely to be the main factor behind the relative resilience of Scottish house prices," added Ms Earley.

Average prices increased by 5.6 per cent over the last year in London, and now stand at an average of £296,772.

In spite of wider falls, some areas remain attractive.

For example, Belfast has seen prices bound 14 per cent, to an average of £304,271, over the last three months, while Aberdeen (13 per cent), London 11 (per cent) Cambridge (ten per cent) and Edinburgh (eight per cent) have also seen increases.

According to Nationwide the average property prices across the UK now stands at £179,363, down from £183,959 at the end of last year.

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