The latest Nationwide House Price Index has revealed house prices remain broadly the same in December 2012, with a small, 0.1%, fall.
The slight reduction means that, according to the Nationwide, house prices fell by 1% in 2012 reversing the 1% rise seen in 2011.
The small changes now means that average cost of a home in the UK is £162,262, which is broadly in line with the other major house price surveys from the Land Registry and Halifax.
As always the average figures mask significant regional variations.
Over the past 12 months only two regions, London and the South East, have seen price rises, whilst Northern Ireland has seen a large reduction of 8.2%, following steep increases before the financial crisis.
Interestingly though, the Nationwide points out that home ownership in London remains lower than anywhere else in the country. Whilst London may have experienced the largest price increase in 2012, and has the highest average house price, less than half of the capital’s population own their own home.
Whilst the percentage of homeowners in a city reflects, to a certain degree, the lifestyles of the inhabitants, for example students are unlikely to be homeowners, it is clear that despite the low interest rate environment and greater access to mortgage lending over recent months, the ‘dream’ of home ownership is just that for many Londoners.
Commenting on the regional variations, Robert Gardener, the Nationwide’s Chief Economist, said: “Amongst the English regions, London was again the best performing area, with prices up 0.7% compared with Q4 2012. The South West was the only other region to record price growth over the year, with the rest seeing small declines.”
Gardener continues: “With the exception of East Anglia, the South of England and the Midlands outperformed the North of England. Yorkshire & Humberside was the weakest performing English region, with prices down 2.5% over the year.”
“Within England, the North/South divide in property prices continued to widen, with the price of a typical home in the South now around £95,000 more than in the North, a new high and around 2% more than at the close of 2011”.
2013 house price predictions
Looking forward to 2013 the Nationwide, along with many housing experts, believe that despite low interest rates, falling unemployment, and the introduction of the Funding for Lending Scheme, house prices will continue to remain flat.
Only the estate agent, Right Move, has predicted a rise in property prices during 2013.