UK House Price on decline: Mortgage falls

The mortgage markets in UK are not willing to take a respite. It has been 5 continuous months of decline in the House prices – they fell for the fifth month in a row during February. However, there were some positive signals that housing demand is beginning to increase due to the lower interest rates.

As per the news, the average price of a house in Wales and England went down by approximately 0.2% during the current month of February to around £175,000, according to property information business - Hometrack.

The yearly inflation rate for house price continued its downward journey to come at just 1.4%, which is its lowest level since April 2006.

But Hometrack said that despite the continued weakness in underlying prices, there were signs that demand was improving, with the number of new buyers registering with estate agents increasing by 7.9% during the month, compared with an 11.5% fall in January.
The group said there was also a slight rise in the number of sales agreed, which contributed to February's price fall being lower than the 0.3% slide seen during each of the previous two months.
The figures come after property website Rightmove reported a 3.2% jump in house prices in England and Wales in the four weeks to February 9, although it said some of the gain was due to market distortions following the final roll-out of the Government's controversial Home Information Packs.
Hence, there has been a modest growth in the registrations of new buyer which is being taken as a proof of increasing and firm demand, but it is backed largely by the recent interest rate cuts across the globe, with London and the South East registering the largest increases in demand.

At the same time, the rise in buyer numbers was met by a similar increase in the number of homes coming on to the market, whereas during the past the growth in demand has outstripped the increase in supply.

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