Possible 10 Percent Drop In House Prices Coming According To Nationwide.

Nationwide shows house price falls

City experts feel a 10 percent drop in house prices through 2011 as Nationwide becomes the latest house price index showing a 0.3 percent dip in November.

The average house price in Britain has dropped by £7,000 since June and as long as there isn’t a major change in December, 2010 will have been a stagnant year for house prices – with no growth or decline.

Using Nationwide’s House Price Index, property values currently average £163,393. Prices, according to Nationwide, peaked in October 2007.

The Council of Mortgage Lenders (CML) places the lack of mortgage finance and removal of specialist lenders liable for the current weakness. Coupled with the responsible lending initiative by the FSA, this is their outlook on why prices are declining.

Others such as the Bank of England think a slowing in demand for property is the culprit – The RICS Index (Royal Institution of Chartered Surveryors) backing this up by showing a trend for slowing new buyer enquiries.

The CML also state the barriers for first-time buyers have removed 800,000 potential households from the property market between 2007 and 2010.

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