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House prices falling by up to 10 per cent – but still not enough to tempt buyers

By Western Morning News  |  Posted: October 03, 2012

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House prices slipped back by 0.4% in September, according to figures from Nationwide, although many industry experts agree that the housing market remains relatively stable.

The fall in house prices increased the annual rate of decline to 0.9% in the region, meaning the average price of a house last month in the greater South West was £186,366 compared with the average national price at £163,964, the figures from the building society revealed.

North Devon saw the largest dip in prices by 8% in September and 5% since last year to £186,294.

In Cornwall and the Isles of Scilly, prices had increased by 1% since last year to £198,601 – but fell by 5% last month.

Gordon Millar, of Stags estate agents in Launceston, claimed there was not a "shadow of doubt" prices had fallen by more than 0.9% since last year in some parts of Devon and Cornwall. He estimated prices had fallen by 5% to 10% in East Cornwall, North Cornwall and North West Devon.

Mr Millar, who has been an estate agent for 45 years, said it was of "great concern" that prices in the Westcountry had escalated beyond many other parts of the UK.

"We face a stalemate unless prices fall by another 10% to 15%. Our main buyers from London and the home counties are going elsewhere, and they won't come back until prices are more reasonable. It is the worst slump I have seen in my professional career, which is a fascinating challenge for a property seller. We've got to find new ways to motivate people to buy."

Richard Copus, Westcountry regional executive for the National Association of Estate Agents and who runs Richard Copus Estates, said the housing market was stable and there was "nothing to worry about".

He said: "A 0.4% drop reflects people being more sensible about asking prices, and it balances out a 0.4% rise earlier this year.

"We should think ourselves lucky when compared to the situation in the Mediterranean and notably the property slump in Spain."

In England, average house prices fell slightly during the third quarter, and were down 0.3% compared with the same period in 2011.

Nationwide's chief economist, Robert Gardner, said: "We expect the UK economy to see a gradual recovery over the next 12 months, with house prices remaining relatively flat or declining only modestly over the same period."

The quarterly report on regional markets showed

London, the outer South East and parts of the North were the only regions not to experience a drop in their prices.

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  • SmartyC  |  October 04 2012, 2:37AM

    *****It is the worst slump I have seen in my professional career, which is a fascinating challenge for a property seller. We've got to find new ways to motivate people to buy."**** A very sensible and realistic appraisal from Mr Miller, except for this bit. You don't have to "find new ways to motive people to buy", you need to find ways to motivate people to sell at prices that actually allow people to buy. Not complicated really, is it?

  • SmartyC  |  October 04 2012, 2:34AM

    Madsolutions, what an apt name! So to be clear, you believe SW house prices are "way too cheap", apart from the one tiny issue of no one being able to afford them!! Genius! The simple truth is that a house are worth what someone is able to afford and is prepared to pay, and not a penny more. The silly lending, the interest only mortgages, the "lie to buy" self certification, and all the other cunning ways of lending people more than they could afford to pay back, are gone. We're back to affordability being the key, exactly as it should be, and even the laughably optimistic ("hold your nerve sellers") Madsolutions admits people simply cannot afford the over-hyped prices still being asked by most. They've a long way to fall yet before they reach a sensible affordable level, and they will. You can't buck the market.

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  • MadSolutions  |  October 03 2012, 9:32PM

    This story is total nonsense, firstly there is nothing unreasonable about prices in the South West in terms of buyers from the South East, please do not believe the BS. There has been no recession in the South East, it's the money bags part of the world. Infact prices in the South West are generally way too cheap and should be between 15-100k more than they are in all cases. What infact holds the South West back are crippling low wages, lack of jobs generally and incredibly poor infrastructure. So homeowners if you aren't desperate to sell, hold your nerve, and hang on in there. Probably the biggest nonsense is the line about prices escalating beyond other parts of the UK, this is true of some areas, but they're generally dumps, but compared to the South East the South West is incredibly cheap. If the house I live in were in a decent part of London we'd be talking £1-2 million even in todays market, yet here in Devon, £3-350k so how does that equate to house prices in the South West escalating way above other areas? What no one's ever explained is how people are going to pay for all these new houses they're going to build in North Devon and what jobs they're going to do.

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  • Stork  |  October 03 2012, 11:30AM

    Almost every week. Buy today, as prices are coming down. Buy next week, as prices are starting to rise. The week after, same again.

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