The gloomy clouds shrouding the housing market continue to cast their shadow. Nationwide report that house prices fell by 0.5% in February, for the fourth month running.
Hoverer, measured on an annual basis, house prices are still rising by 2.7%. This is the lowest annual growth rate since November 2005. Less than a year ago house price inflation was 11.1%.
Adding to the gloom, the Land Registry report that the total number of houses sold in November 2007 fell by 20% compared to November 2006.
Nationwide, whose job it is to sell mortgages, publicly remain calm about the situation; they note that the fall in annual house price inflation, between January and February (annual house price inflation in January was 4.2%), could be overstating the trend.
Nationwide also noted that the fact that the UK does not seem to be heading for a recession should provide some support. They forecast flat house prices for 2008.
The property market, just like all other markets, is driven in part by sentiment. The sentiment, and future direction of the market, will depend on there being no further unpleasant economic/financial shocks this year.
Does anyone have a crystal ball?