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Average UK house prices fall 10.2% over year

These statistics, which include data based on mortgage completions during the month of December 2008, also revealed that UK house prices fell by 6.4% in the quarter ending December 2008.

This compares with a fall of 3.0% for the quarter ending September 2008.

Commenting on the figures, Howard Archer, chief UK and European economist at IHS Global Insight, said: "We certainly expect house prices to continue to fall for some considerable time to come.

"Powerful negative downward forces on housing market activity and prices continue to come from ongoing very tight credit conditions, sharply rising unemployment (and) slowing income growth."

The UK average house price drop of 10.2% in the year to December 2008, compared with a fall of 8.5% in the year to November 2008.

Between November and December there was a fall of 2.3% in the prices index of properties bought compared with a smaller fall of 0.4% over the same period last year, resulting in a decrease in the annual rate.

The fall in UK prices between November and December 2008 can be attributed to decreases in average prices for detached houses (4.1%), flats (2.4%), bungalows (2.3%), semi-detached houses (2.0%) and terraced houses (0.8%).

Annual house prices fell in all UK countries in the year to December 2008. Annual house price growth was -10.4% in England,  -10.3% in Wales and -6.0% in Scotland.

Northern Ireland was hit hardest with annual house price growth at -17.9%.

Prices also fell in all nine of the English regions during December.

The annual house price growth ranged from -8.9% in the North East to -11.5% in East Midlands.

The annual growth rates in the other regions were -9.3% in the North West, -9.6% in London, -10.2% in each of the West Midlands and the South West, -10.8% in each of the Yorkshire and the Humber and East regions and -11.3% in the South East.

Mix-adjusted average house prices in December 2008 were £201,676 in England, £148,993 in Wales, £152,256 in Scotland and £183,457 in Northern Ireland.

The English region with the highest average house price in December remains London at £304,421. The lowest average price was in the North East at £136,057.

Of the English regions, only the East, London, South East and the South West had average prices above the UK average.

According to the statistics, the UK annual growth in house prices for first-time buyers fell from -11.6% in November to -13.0% in December. There was a decrease of 1.3% between November and December in the price of properties bought by first-time buyers compared with a small rise of 0.3% last year resulting in a decrease in the annual rate.

Also, the annual house price growth rate for former owner occupiers was -9.2% in December, down from -7.3% in November.

The prices index between November and December for properties bought by former owner occupiers fell by 2.7% compared with a smaller fall of 0.6% at the same time last year resulting in a decrease in the annual rate.

The average price paid by first-time buyers across the whole of the UK was £140,857 in December, while the average price paid by former owner occupiers was £227,633.

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