Property prices fell by 0.6% during October, the fastest rate in over three years, Hometrack has confirmed.
According to the property research company, no part of the UK has escaped the clutches of the market downturn, with no single county reporting house price increases during October.
The largest falls occurred in the south, with Avon and most parts of London suffering the greatest price drops, Hometrack reported. However, falls in the north are becoming more widespread, with prices dropping notably in Tyne and Wear, Lancashire and Northumberland.
Indicators for the future of the market are also looking bleak, Hometrack said, with supply relative to demand increasing for the fifth month running, and average time taken to sell and average number of viewings per property rising over October to 6.5 weeks and 11.9 viewings respectively.
Vendors are also realising less at sale, with the average price achieved falling to 93.7% of the asking price, down from 94.5% in September, casting further doubt on the future of the market.
As a result, Hometrack anticipates further price falls over the coming months, and no growth during 2005.
Hometrack’s Housing Economist John Wriglesworth said: ‘While rising interest rates have influenced the recent run of house price falls, the key reason for the stagnating house price environment is that house prices have finally reached their peak in the current cycle.
‘However, we see no sudden or significant prospective downturn. Much lower interest rates compared with 10 years ago, strong rises in household incomes, lower unemployment and lenders now willing to offer larger mortgages relative to incomes all point to a levelling out of house prices. House prices will not plummet into an abyss as some of the doomist commentators have been predicting.’
