According to Nationwide Building Society, property prices fell by 0.5 per cent across the UK in December. However, the study indicated that the average price of a house had increased by £8,334 over the year.
Fionnuala Earley, Nationwide’s chief economist, said: “While we finish the year with house prices broadly in the range we had expected, the path to this point has been quite different to our expectations. Most indicators now show that demand is responding to the pressures of weak affordability, past increases in interest rates, and the lower house price expectations that we had anticipated earlier in the year.”
Elsewhere, Nationwide’s report showed that some towns were experiencing extensive house price growth, with Belfast enjoying a 32 per cent rise in 2007 – equating to an increase of around £200 a day.
St Albans remained the most expensive town in the UK with an average property price of £350,000, while Oxford maintained its position as one of the most expensive places to live. The North East slipped though, as Newcastle and Durham both saw property prices fall by 3 per cent in 2007.
Nicholas Leeming, major clients director at propertyfinder.com, said: “The first half of 2008 will see price growth slow to a crawl and the Bank should act sooner rather than later to spur confidence and encourage a recovery in the housing market, one of the engines of the UK economy.”
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