According to the Halifax the average UK house price now stands at just under £154,720 having fallen 1.7% in April taking the fall over the past year to 17.7%. But a more important factor my be the number of mortgage approvals.
As usual the Nationwide figure shows a considerable difference with the fall registering just 0.4% in April making a 15% fall over the year.
The ratio of property price to earnings on the Halifax figures has fallen to 4.26 against a peak of 5.84 at the height of the boom.
The number of mortgage approvals was 29,230 in March which is signigficant because historical analysis by Swiss Bank UBS has suggested that about 45,000 monthly approvals are required to support a stable house price environment.
A return to a monthly rate of 45,000 is possible this year but getting much beyond that level could take until late next spring. Most analysts are predicting further falls in house prices throughout 2009.
Meanwhile Lloyds, Britain’s biggest lender, has predicted house prices have only 6% further to fall and could rise by the end of 2009. Lloyds, which has a 30% share of the mortgage market, previously thought house prices would fall 15% this year (or a drop of about 34% from the August 2007 peak price). However, it now believes this year’s decline is likely to be closer to 10% (or 28% from the peak to a trough) with prices probably bottoming within months.
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Halifax Bank of Scotland