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| Low sales drive house prices down | Low sales drive house prices down |
| (about 7 hours later) | |
| UK house prices continued falling in October and are now nearly 15% lower than a year ago, says the Nationwide. | UK house prices continued falling in October and are now nearly 15% lower than a year ago, says the Nationwide. |
| The building society's latest survey says property prices fell by 1.4% this past month, pushing the annual rate of fall up from 12.4% to 14.6%. | The building society's latest survey says property prices fell by 1.4% this past month, pushing the annual rate of fall up from 12.4% to 14.6%. |
| This means the price of an average house was £158,872 - nearly £30,000 less than a year ago. | This means the price of an average house was £158,872 - nearly £30,000 less than a year ago. |
| The Nationwide said the price falls were being driven by the fall in sales, now at their lowest for 34 years. | The Nationwide said the price falls were being driven by the fall in sales, now at their lowest for 34 years. |
| "The number of completed house purchase transactions as a proportion of the total stock of mortgages is now at its lowest ever level since the series started in 1974," said the Nationwide's chief economist, Fionnuala Earley. | "The number of completed house purchase transactions as a proportion of the total stock of mortgages is now at its lowest ever level since the series started in 1974," said the Nationwide's chief economist, Fionnuala Earley. |
| "A looming recession and continued financial market instability have uncomfortable implications for the housing and mortgage markets, and will undoubtedly affect the pace of recovery in house prices. | "A looming recession and continued financial market instability have uncomfortable implications for the housing and mortgage markets, and will undoubtedly affect the pace of recovery in house prices. |
| "However, the speed of the economic slowdown and the determination on the part of central banks to return stability to the financial markets does mean that interest rates are likely to continue to be cut sharply," she added. | "However, the speed of the economic slowdown and the determination on the part of central banks to return stability to the financial markets does mean that interest rates are likely to continue to be cut sharply," she added. |
| Lending squeeze | Lending squeeze |
| Other figures suggest there will be no let-up, in the short term, in the dramatic slump in the property market. | Other figures suggest there will be no let-up, in the short term, in the dramatic slump in the property market. |
| Figures from the Bank of England on Wednesday showed that mortgages approved but not yet lent - a key indicator of short-term trends - were still down by two-thirds on the levels seen a year ago. | Figures from the Bank of England on Wednesday showed that mortgages approved but not yet lent - a key indicator of short-term trends - were still down by two-thirds on the levels seen a year ago. |
| Meanwhile, the year-long crisis in the banking system has shown no signs of relief, despite the efforts of central banks and governments around the globe. | Meanwhile, the year-long crisis in the banking system has shown no signs of relief, despite the efforts of central banks and governments around the globe. |
| As a result, banks in the UK are still severely restricting their new mortgage lending, a trend which is likely to continue in the next few months, according to the Bank's recent Financial Stability Report. | As a result, banks in the UK are still severely restricting their new mortgage lending, a trend which is likely to continue in the next few months, according to the Bank's recent Financial Stability Report. |