Housing market slows in February

Market information company Hometrack has reported the number of homes for sale across England and Wales rose 4.6 per cent – compared with an average of 14 per cent in previous years, and buyer numbers rose 8.3 per cent – compared with an average of 24 per cent.

Despite the lack of activity, Hometrack found prices rose 0.3 per cent for the month, up on the 0.1 per cent increases seen in December and January. However Nationwide, which released its UK index on Friday, said prices had fallen 1 per cent during the month.

Nationwide’s report said this month’s fall was smaller than the 1.5 per cent drop recorded in February 2009, so annual price inflation increased from 8.6 per cent to 9.2 per cent. It said the average price of a property sold in the UK during February was £161,320.

Land Registry figures, which were also published on Friday but run a month behind Hometrack and Nationwide, state prices rose 2.1 per cent across England and Wales between December and January.

House prices rose in seven regions of England and Wales, with the highest increase in London, at 10.5 per cent. The number of completed sales also rose by 54 per cent, from 36,091 to 55,715.

Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors, said: ‘While bad weather may have played a role in knocking both activity and prices this month, RICS believes that there shouldn’t be too much emphasis placed on monthly volatility in the numbers.

‘The underlying trend in the Nationwide data is still pointing toward an annualised increase in prices of more than 6 per cent.’

Martin Gahbauer, Nationwide’s chief economist, said: ‘At this stage, it is difficult to gauge how much of the drop in housing activity is attributable to one-off factors and therefore whether February’s fall in prices is just a temporary blip or the start of a new trend.’

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