Annual fall in house prices 2.5 percent

House prices became side-tracked in June according to the Land Registry, reaching an average of £161,479 compared with £161,823 in May.

The figures mean that the annual fall in house prices is 2.5 percent. London is the only region to experience an increase in house prices over the past year (0.8 percent), though even there growth is quite slow.

Nicholas Ayre, head of UK buying agents Home Fusion, said the Land Registry's figures gave plenty for 'doomsayers to get their teeth stuck into' though he warned against taking too speedy a judgement, saying: 'The data can be fickle. Just as your car's fuel gauge becomes unreliable when the engine's running on empty, so these figures have less value when the number of sales is so low.

'Outside London, demand has fallen off a cliff, and unsurprisingly, so have prices. At the top end of the London market, supply is limited and demand is booming and this is steadily driving prices up. Less fashionable areas appear more of a buyers' market, with a big gap opening between asking and sale prices. And because there is more supply and fewer buyers, those looking to buy can afford to be pickier.

'For the country as a whole, the market is still desperately fragile. With lenders still reluctant to offer mortgages, and many who bought in the boom trapped in their current homes by negative equity, there's little chance it will perk up any time soon.'

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