House prices fall at record annual rate in March

LONDON Mon Mar 30, 2009 9:04am BST

Houses in an undated photo. REUTERS/File

Houses in an undated photo.

Credit: Reuters/File

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LONDON (Reuters) - House prices in England and Wales are a record 10.3 percent lower than a year ago, even though the prices fell at their slowest pace for 10 months in March, property data company Hometrack said on Monday.

March's annual fall was the biggest yet in Hometrack's monthly survey of estate agents and surveyors, which started in 2000 and has persistently reported lower price falls than official government data and that from mortgage lenders.

The average achievable selling price for March was 156,100 pounds, 0.6 percent lower than in February and the smallest monthly fall since May last year -- something which Hometrack said was mostly due to seasonal factors.

"With the expectation of continued increases in unemployment and weak economic growth together with restricted availability of mortgages, it seems doubtful whether the increase in activity and sales will continue to gather momentum in the coming months," said Richard Donnell, Hometrack's director of research.

"Prices look set to remain under downward pressure over the rest of 2009," he added.

Some other indicators improved. The proportion of postcode districts reporting falling prices fell to 50 percent from 59 percent, the smallest since March last year.

And sellers achieved 88.8 percent of their asking prices on average compared to 88.3 percent in February -- the first improvement in this ratio since March last year as well.

"This situation could well reverse in the near term as much still depends upon improved consumer confidence, a gradual recovery in mortgage lending and greater stability in the economic outlook," Donnell said.

House prices in London showed the biggest national fall, dropping 0.8 percent in March to an average of 274,700 pounds.

(Reporting by David Milliken; Editing by Andy Bruce)

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