House prices have fallen further in the West Midlands than those in any other part of Great Britain.
The dip is so far only a modest 1.9 per cent, according to numbers for the year to June from the Department of Communities and Local Government.
The DCLG’s findings show house prices generally holding up far better than that the deeply depressed indices from Halifax and Nationwide.
They are based on completed purchases, while the mortgage lenders’ surveys are more up to date, but calculated from home loans at the time they are agreed. They also take account of homes bought for cash where no mortgage is involved.
As a result, the DCLG’s figures for June show house prices across the UK still 0.6 per cent higher year on year after falling by 1.1 per cent since March and by 0.7 per cent during the month of June.
This contrasts markedly with falls of 8.1 per cent and 8.8 per cent reported by Nationwide and Halifax for the 12 months to July.
Scotland and four English regions were still showing annual increases by the DCLG’s measure.
Details of its conclusions show that the fall between May and June arose overwhelmingly from a 3.6 per cent drop in the average price at which flats were changing hands.
This was reflected in a 1.3 per cent drop during the month in prices paid by first-time buyers, though these were still only 0.5 per cent less than in June last year.
Semi-detached houses slipped by a more modest 0.9 per cent between May and June and terraced houses by 0.3 per cent.
But these falls were offset by a 0.8 per cent increase in the average price for bungalows and one of 0.7 per cent for detached houses.
Prices paid by former owner-occupiers eased by 0.9 per cent during June, to an average down by 0.9 per cent on June last year.
Only eastern England, London, the southeast and southwest had an average house price above the UK average of £215,029 in June, down from £216,625 in May.
The UK average is heavily skewed by a fall of nearly ten per cent in house prices in Northern Ireland, where a runaway boom has burst, only partly offset by a seven per cent increase in Scotland.
Howard Archer, UK and European economist at the consultants Global Insight, pointed out the DCLG provides “lagging evidence” of trends in the housing market and refused to be reassured by its findings.
“Unemployment is now rising at an accelerating rate, which, along with a substantial number of home-owners having to re-mortgage at a higher rate, is increasing the likelihood that people will have to sell their house for ‘distressed’ reasons,” he said.
“This would lead to more houses coming on to the market and would be liable to depress prices.”
He is forecasting that house prices will fall by 15 per cent this year and by 12 per cent in 2009, by the Halifax and Nationwide measures, before settling 30 per cent below their peak last year in 2010.