UK house prices down 5.3%

Property prices in the UK have fallen for the eleventh consecutive month, according to the latest house price index from Hometrack.

Annual falls now total some 5.3 per cent – the lowest level since the survey began in 2001.

Prices fell by 0.9 per cent in August alone, following falls of one per cent in June and 1.2 per cent in July, according to the housing intelligence organisation.

"When the market turns it can take as long as 24 to 36 months for prices to reach realistic levels and we are now well into this process," explained Richard Donnell, Hometrack's director of research.

"We may well start to see a moderation in the rate of monthly price falls, however, with ever growing uncertainty among households over the broader economic outlook the current re-pricing of housing still has some way to run."

The average time a property remains on the market before being sold has also continued to increase. While it took around 10.3 weeks to secure the sale of a property in June, this increased to 11 weeks in July and 11 in August.

Properties are now only achieving 90.7 per cent of the asking price, finds Hometrack. The latest Rightmove house price survey also reveals these asking prices have declined 4.8 per cent over the last year.

Uniquely the Hometrack survey reveals prices fell in 58.1 of post code districts over the month.

"While demand remains weak with continued falls in new buyer registrations over August, a small but growing proportion of agents are reporting some improved signs of buyer interest on the back of lower prices and a modest reduction in the cost of mortgages," added Mr Donnell.

"This trend could well become more evident over the autumn as we continue to move towards more realistic levels of pricing."

The supply of property entering the market fell by 0.7 per cent over August, reflecting the expected slowdown in property transactions expected during the month.