Second Quarter House Prices 10.07.2009

Author: Simon Whittaker Posted on: 10 July 2009

I am going to claim success - even though Halifax themselves reported a 1.9% drop in the second quarter.  The reason I am claiming success is that Halifax have compared the average of the prices in the first quarter with the average in the second quarter whereas I looked at the prices reported in June and compared them with the prices in March - and this increased by 0.25%.  So with Nationwide producing the predicted increase in prices - and with a statistical sleight of hand - my prediction has been borne out!

Nevertheless I have to acknowledge that my preferred index - the FT HPI - did report a drop of 1.4% in the second quarter (June over March) whilst also commenting "the monthly change at -0.3% is one seventh of the peak fall recorded seven months ago , at -2.2% in November 2008, and the data do suggest that the sharpest falls are behind us and that the rate of decline has now slowed significantly".

With a small (seasonally adjusted) uplift in sales volumes this could indicate that the market is bottoming out - although this will be dependant upon a continuing supply of both residential mortgages and buy to let mortgages to "oil the wheals" of the property market.

I repeat earlier predictions that we will continue to see mixed data over the next quarter before some clarity returns in the final quarter.

Author: Simon Whittaker