Drop in house prices accelerates

May saw the biggest annual drop in house prices since October 2009, leaving the average home costing just £160,519.

The average home costs 1.4% less than at the start of the year, though prices did creep back up 0.1% during May itself.

Halifax housing economist Martin Ellis said: 'Low earnings growth, higher taxes and relatively high inflation are all putting pressure on household finances. Confidence is also weak as a result of uncertainty about the economic and employment outlook.

'These factors are probably constraining housing demand and applying some downward pressure on prices.'

Sounds like a good time to buy? Think again. The Bank of England reported a mortgage approval rating drop of 4% during May, which itself has had a knock-on effect on sales during the merry month of May.

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