4
Sep
House price dip may have affordability benefits
Halifax has recorded a further fall in house prices during August,
something that may benefit first-time buyers looking for an
affordable home.
Figures from the bank for August have shown that the average UK
house price dropped during the month by 1.8 per cent, to
£174,178.
A key affordability finding of the survey was that the ratio of
house price to income has fallen from 5.84 in July 2007 to 5.13 in
June 2008.
The bank's chief economist Martin Ellis suggested that many factors
may prevent the figure falling much further.
"A solid labour market, low interest rates and a shortage of new
houses continue to support the market," he said.
Those hoping for an interest rate cut today were left to wait again
by the Bank of England's monetary policy committee as it held the
base rate for the fifth successive month.
However, CBI chief economic advisor Ian McCafferty predicted that a
rate cut may be increasingly on the cards in the coming months as
inflationary pressures fade.
