Ft Index Points To Slowing Housing Market

[sambino]

http://www.ft.com/cms/s/0/13310e38-eb97-11...00779fd2ac.html

UK house prices saw a modest pick-up in February after three months of stagnation, but the overall trend is towards a slowing housing market, according to the latest data from Acadametrics, producer of the FT House Price Index.

The Index showed a 0.5 per cent rise in house prices, with year-on-year inflation totalling 6.1 per cent, down from an annualised rate of 6.8 per cent in January. February’s rise in house prices was slightly stronger than the 0.2 per cent rise seen in January and the dip in house prices of 0.1 and 0.1 per cent seen in December and November respectively. The three months through January were the lowest monthly growth rates seen in over three years.

Peter Williams, chairman of Acadametrics, noted that London house prices, which rose at an annualised rate of 12.7 per cent in February, are still well out of line with those of the UK generally and are more than twice the national average. “An annual increase of 6.1 per cent is still substantial (4.7 per cent without London) but it is moving in the direction of longer run market averages,” Mr Williams said. “It shows on an annual basis that the market has been trending downwards and this view has been backed by almost all other market reporting.”

Mr Williams noted that even though London home prices were substantially higher than those elsewhere, and are rising faster than those of any other region, February’s data show the fifth consecutive monthly fall in the annual rate of house price inflation for the area.

Moreover, surveys of consumer confidence produced by GfK/NOP and Nationwide Building Society - a sentiment which seems to closely track housing demand - all show signs of weakening. “We are now seeking a clear feed through from the problems in the funding markets in terms of the increased price and reduced availability of a wide range of mortgage products,” Mr Williams said. “Without a doubt, 2008 will be a challenging year”.

Within London, the pace of house price inflation varied widely in February, with Kensington and Chelsea showing a 27.3 per cent annualised growth rate while Bexley’s annualised house price growth rate was just 6.6 per cent.

Of the 108 districts and counties in England and Wales. only 7 recorded growth rates of more than 10 per cent. Forty-six had growth rates of less than 5 per cent and of these, 5 saw prices actually fall.

Among the regions, Wales sustained the greatest drop in house prices, falling 0.9 per cent in February , extending a trend of falling house prices for three consecutive months. Houses in the North of England and in East Anglia also showed declines, falling 0.1 and 0.2 per cent respectively.

[sign_of_the_times]

to summarise.....

its grim up north and the south is in denial

[kagiso]

to summarise.....

its grim up north and the south is in denial

With the exception of the Northwest, pretty much spot on.

Full Acadametrics report at:

http://www.acadametrics.co.uk/FTHPI%20Pres...bruary%2008.pdf

The regional table makes for interesting reading, London & SE both at +0.5%, NW +0.3%.

Only other positive is the SW squeezing in at 0.1%.

The other six out of nine regions either zero or negative.

If you take inflation into account, with RPI at slightly over 0.3% per month, that is seven out of nine regions posting real falls.

Wales seems to have moved into full scale crash territory with three consequtive drops. This month's was -0.9% which makes a total nominal drop of 1.8% for the last quarter, and FT/Acadametrics is seasonally adjusted.

If you add on RPI that is significantly above 10% annualised real falls.

Also noteworthy are the North on 1.7% annual growth, and the West Midlands on 1.8% annual growth. Both of which are annual real drops, they don't even manage to beat CPI, never mind RPI.

Unless the oligarchs start buying up whole streets in these two regions pdq, then both are certainly going to be showing YoY drops in two months time, and just possibly next month.