Figures from the Land Registry show house prices fell by 0.9% in the year to January
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House prices in England and Wales recorded their first year-on-year fall for 15 months during January, latest figures show, as the housing market continued to come under pressure.
The average cost of a home dropped by 0.9% during the year to the end of January to �163,177 ? the first time annual growth has been negative since October 2009, the Land Registry said.
The year-on-year drop came despite house prices edging ahead by 0.2% during the month itself ? the first rise for five months.
Property transactions remained subdued with just 54,012 homes changing hands in November (the latest month for which figures are available) ? the lowest level since May last year and 6% down on October's figure.
House prices have come under increasing pressure due to a lack of demand as potential buyers sit on their hands due to uncertainty in both the housing market and the wider economy, while those who want to make a purchase are struggling to raise the required mortgage finance.
Paul Diggle, property economist at Capital Economics, said: "The small gain in house prices in January is unlikely to signal an end to the weakening trend. Indeed, if our economic forecasts are correct, the downward pressures on house prices are only set to build through 2011."
Howard Archer, chief UK and European economist at IHS Global Insight, said: "The small rise in house prices in January, following four months of decline, does little to dilute the impression that the the housing market is stuck in the doldrums with prices under pressure.
"We expect house prices to continue to trend down gradually in 2011 after losing ground overall in the latter months of 2010. Specifically, we suspect that house prices will fall by around 5% in 2011 and eventually end up losing around 10% from the peak levels seen in the first half of 2010."
All regions of England and Wales recorded annual house price falls, apart from London, where values have risen by 2.4% during the year to the end of January, and the east, where they have edged up by 0.2%.
Falls have been steepest in Wales, with the average cost of a home diving by 6.1% during the past year, while in Yorkshire and the Humber and the north-east prices have dropped by 2.6% and 2.5% respectively.
The cost of a home in Wales dived by 4.2% during January alone, while prices fell by 2% in the north-west.
Only four regions recorded price rises during the month, with values increasing by 1.6% in London and the south-west, and by 0.5% in the south-east and 0.4% in the east.
Source: http://www.guardian.co.uk/money/2011/feb/28/house-prices-year-on-year-fall
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