House prices drop in November

Published: November 29, 2007

New figures showed that house prices in the UK dropped considerably in November.

According to Nationwide, house prices in the country fell by their sharpest rate for over 12 years during the month.

Prices dropped by 0.8 per cent, compared to an increase of 1.1 per cent in October.

Factors which are believed to have influenced the fall including rising interest rates, more expensive mortgages and uncertainty after recent global financial turbulence.

The decrease means that the annual rate of house price inflation fell from 9.7 per cent in October to 6.9 per cent.

However, Nationwide said that the prospect of interest rate cuts in the new year mean that it is unlikely that a more significant crash is likely.

"When the underlying data is looked at in more detail the picture is a lot less startling," Nationwide's chief economist Fionnuala Earley said.

"When looking at the amount prices have changed, the health of the market looks much less in jeopardy than the initial reading that may have been taken from the balance data.

"The underlying fundamentals are perhaps more positive than the recent swings in sentiment might suggest."