Survey confirms property slowdown

Government figures have confirmed a widely reported slowdown of the UK's housing market in late 2004.

House prices were 11.8% higher on the year in the last quarter of 2004, down from 16.3% in the July-to-September quarter, the Land Registry said. The average house price in England and Wales was £182,920, down from £187,971 in July-September. The volume of sales between October and December dropped by nearly a quarter from the same period in 2003. The government figures are the first official confirmation of falls in the market at the end of 2004. Land Registry figures are less up to date than those of banks and building societies, since they record completions not mortgage approvals. However, the figures are viewed as the most accurate measure of house prices as they include all property transactions, including cash sales.

The cost of buying a home fell in seven out of 10 regions between the third and fourth quarters of 2004.

The biggest annual gains were made in Wales, where house prices were up by 23% in the fourth quarter. House prices rose the slowest in Greater London, being up by 6%. In the capital, the volume of sales fell by 23% from 36,185 in 2003 to 28,041 for the same period in 2004. There was also a decline in the number of million-pound properties sold in the capital, with 436 properties over £1m sold compared to 469 for the same period in 2003. Although the figures point to a slowdown in the market, the most recent surveys from Nationwide and Halifax have indicated the market may be undergoing a revival. After registering falls at the back end of 2004, Halifax said house prices rose by 0.8% in January and Nationwide reported a rise of 0.4% in the first month of the year. Members of the Bank of England's rate-setting committee will make their latest decision on interest rates on Thursday.