UK House Prices to Fall Until 2012 - National Housing Federation

UK - 03/08/2009 - The National Housing Federation has said that UK house prices will continue falling until 2012. The research, conducted on behalf of the NHF by Oxford Economics led to forecasts of a 12.2% drop this year, followed by a 4.6% fall next year and a 1.1% fall in 2011. However, the report also said that house prices will be 20% higher in 2014 than they are now.

Even some people who have very bearish about the housing market are now back-tracking; because of the strong upward momentum on house prices at present, some are now saying that house prices may end this year higher than they started it. Bears still believe that a second fall is inevitable, but now fear that it may not happen before the end of this year.

I got a call from Richard McKay, director of private property sales site Zungalow.com, to discuss where my views were on the housing market at the moment. I have taken quotes from Richard frequently because of the insightful articles you will find on the company blog (the Zlog).

We talked about the increase in mortgage approvals, mortgage lending (for house purchase) and the decreased forecasts for repossessions, as well as the generally more positive feel and raised confidence currently at play. We managed to come to a conclusion that we were both relatively happy with.

That the Land Registry and DCLG indices would report house price rises in June, July and possibly August at a push, but prices would probably start falling again as the seasonal change combines with the increasing supply fuelled by a rising market to knock the floor out of the current upward push. It all depends whether the rises bring us out of negative annual territory by more than the following falls whether we end 2009 with prices higher or lower.