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June house prices show marginal increase

House prices have risen by 0.9% in the year to June 2012 as sales continue to fall according to the Land registry.

Official figures indicated the sales of homes worth more than £1 million declined by an enormous 43%, from 825 to 467.

Between May and June, house prices in England and Wales rose by 0.1%, taking the average property price of a property to £161,777.

Year-on-year prices fell by 19% in April, although total sales for the first four months of 2012 were 8% higher than 2011.

Speaking to the Guardian, Peter Rollings of estate agent Marsh & Parsons said: “A shortage of supply may be helping prop up prices nationwide, but the true thermometer for the national housing market is the number of sales taking place. By this measure, the national market is far from fighting fit.”

Tight lending criteria was a key factor in thwarting buyer demand, especially at a time when consumer spending power is already facing other pressures. Current homeowners are benefiting from falling rates, but most new buyers are locked out of these special deals.

Inter-bank lending - so-called “swap rates” - have also fallen to their lowest ever levels. As a result HSBC has unveiled its lowest-ever five-year fixed rate mortgage at 2.99%, a figure matched by Santander for existing current account customers.

Nationwide has reduced rates across a wide range of mortgages by up to 0.4%.

However, the majority of these deals are only available to borrowers with large deposits, excluding first time buyers from the favourable rates.

This was posted in Bdaily's Members' News section by Ruth Mitchell .