Average house prices fell by 2.6% in November from the previous month, wiping out the gains on home equity earned since July 2005, according to the Halifax house price index published yesterday.
The month-on-month drop was the biggest for more than 16 years, helping send sterling to a new 6.5-year low against the dollar and a record low versus the euro.
The price fall was much steeper than that recorded for the same period by another lender’s index, that of the Nationwide building society, which showed only a 0.4% drop for November. The two indices had been moving in step with each for several years.
Smoothing out monthly fluctuations, house prices were 14.9% below their levels in November 2007, when they were already beginning to ease, according to the Halifax. But on a straight comparison basis, prices were down 16.1% – exceeding the peak-to-trough drop seen in the early 1990s.
Financial Times, The Times, Daily Telegraph, The Independent