First time buyers have cause to take note, as new data from the Land Registry shows the first drop in house prices in over a year.
House prices in May showed a marginal drop of 0.2% from April, which was significant for being the first drop in house prices since March 2009.
The Land Registry Index measures only prices based on completed house sales, and as such is more indicative of any first time buyer mortgage deals that lie behind those sales. Other indexes published by lenders such as Halifax and Nationwide are different, in that they reflect sales agreed and mortgage deals which have not yet been completed.
House price behaviour was, as usual, different by region. While the prices outside London may bode well for first time buyer mortgages in regional UK, London itself showed an actual increase in house prices, when taken on its own. London house prices rose by 0.7% in May over April.
In the East Midlands and North-East of England the drop in house prices was most pronounced, at 3.6% and 1.9% respectively.
In addition to the Land Registry Index, other reports confirm that the number of properties now being placed on the market for sale is on the rise.
The Land Registry Index is regarded as a ‘lagging’ index, because the figures it contains reflect sales and mortgage deals up to 3 months after they have occurred.
