Update: Halifax reveals annual house price drop
The price of a house in the UK now costs 0.9% less than it did a year ago following a 1.3% tumble in April, according to the latest survey by the UK's largest mortgage lender.
Halifax found that the average price of a home here fell to £189,027 last month. It is the second report this week indicating a decline in prices over the past 12 months and follows the 2.5% slide in March, the biggest monthly fall since 1992.
The former building society now expects to see a mid single digit percentage decline in prices this year, though some areas such as Scotland, are still likely to record modest increases.
Wales and West Midlands were singled out as areas likely to see falls above the national average.
A squeeze on spending power and the rapid rise in house prices in the last few years was blamed for a drop in demand and the subsequent impact on prices.
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Meanwhile, rising interest rates up to July 2007 have increased average mortgage costs and 'real' earnings have declined over the past year.
Housing market activity is significantly lower than a year ago, said Halifax, with completed property sales in March down 20% on an annual basis.
It expects the Bank of England to maintain a 'gradualist' monetary policy stance, lowering rates at a steady pace. Borrowing costs have dropped three times in the last five months to 5%.
This latest survey follows a report by rival Nationwide on Wednesday that also showed house prices fell on an annual basis for the first time in 12 years last month.
Prospective buyers found it increasingly difficult to finance property purchases, sending the average house price down 1% to £178,555 on the year before, something that hasn't happened since March 1996.
