House prices still below boom levels

Updated: 

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In case there was any doubt, here is ample evidence that the pre-crisis housing boom is well and truly over.

Rochford in Essex and South Lakeland are the only two local authority districts in the UK where house prices have bucked the slump and are currently higher than they were in 2007 - but only just, according to the latest research from mortgage lender Halifax.

The research demonstrates that, since th market peaked in 2007 followed by years of falling prices, homes across the country are still well short of those peak historical values. Even in Rochford (1%) and South Lakeland (0.1%), prices are only slightly above pre-recession levels.

The list of 20 areas where prices have performed best since 2007 is dominated by southern England, with only four of the top 20 outside the south.

Three of those - South Lakeland, Derbyshire Dales and Ceredigion - are popular holiday areas where retirees and second homebuyers have helped underpin prices. Aberdeenshire is the only other area outside the south in the top 20. The market here has been supported by the local oil industry, which has fared very well in the past few years.

Worst performers
The nine worst performers are all in Northern Ireland. The biggest drop has been in Craigavon where the average price has more than halved, from £213,844 in 2007 to £103,383 in 2011. Prices have fallen sharply in Northern Ireland follwing the remarkable - and ultimately unsustainable - gains in the years leading up to 2007. In 2007, average prices in Northern Ireland were the highest in the UK outside London and the South East – but now Northern Ireland has the lowest average prices of any region in the country.

Three of the areas with the biggest house price falls in recent years are in Wales: Wrexham, Neath Port Talbot and Flintshire.

Martin Ellis, housing economist at Halifax, said: "The whole UK has been hit hard by the economic downturn of the last few years. There are only two areas of the country where house prices are currently higher than they were at the peak of the boom in 2007 and even here the increases are marginal.

"A striking feature of our analysis of the areas that have fared best and worst in the past four years is a distinct north-south divide. Those areas that have weathered the storm best are nearly all in the south whereas those areas worst affected are all outside southern England. Northern Ireland has done particularly badly as much of the sharp gains in the years prior to 2007 have since been reversed."

Market picking up?
However, there are some signs the market is picking up again. House sales edged higher at the start of this year, with some first-time buyers desperate to beat the end of the stamp duty holiday on 24 March. While prices in much of the country continued to drop, surveyors have become markedly less pessimistic about the outlook for the next 12 months, according to the Royal Institution of Chartered Surveyors.

"Housing market conditions have remained broadly stable at subdued levels over the past year and there is little indication that this will change substantially in the coming months," said Barclays Capital economist Blerina Uruci.

Table 1:20 Best Performers 2007 - 2011

Local Authority District

Region

Average House Price 2007 £

Average House Price 2011 £

% Change 2011 -2007

Rochford

East of England

229,666

231,595

1%

South Lakeland

North West

212,274

212,457

0%

Islington

London

474,473

470,206

-1%

Hart

South East

331,283

326,555

-1%

Spelthorne

South East

283,789

278,216

-2%

Worthing

South East

222,150

216,435

-3%

Ceredigion

Wales

183,610

177,968

-3%

Windsor and Maidenhead

South East

410,423

396,826

-3%

Hillingdon

London

282,410

272,699

-3%

Derbyshire Dales

East Midlands

259,104

249,189

-4%

Brent

London

350,098

335,574

-4%

Torridge

South West

211,203

199,638

-5%

Exeter

South West

208,147

195,129

-6%

Epsom and Ewell

South East

334,734

312,717

-7%

Harrow

London

339,076

316,595

-7%

Hackney

London

362,516

337,433

-7%

Uttlesford

East of England

341,182

317,528

-7%

Shepway

South East

209,462

194,926

-7%

Aberdeenshire

Scotland

212,694

197,918

-7%

Rushmoor

South East

224,092

207,906

-7%

UK

228,251

172,427

-24%


Source: Halifax

Table 1:20 Worst Performers 2007 - 2011

Local Authority District

Region

Average House Price 2007 £

Average House Price 2011 £

% Change 2011 -2007

Craigavon

Northern Ireland

213,844

101,383

-53%

Newtownabbey

Northern Ireland

218,111

107,992

-50%

Ballymena

Northern Ireland

241,198

120,894

-50%

North Down

Northern Ireland

289,571

145,974

-50%

Belfast

Northern Ireland

226,431

117,077

-48%

Castlereagh

Northern Ireland

245,377

126,943

-48%

Lisburn

Northern Ireland

238,287

126,703

-47%

Ards

Northern Ireland

246,074

136,072

-45%

Derry City

Northern Ireland

184,767

105,791

-43%

Corby

East Midlands

168,010

109,316

-35%

Bromsgrove

West Midlands

282,721

185,943

-34%

Northumberland

North East

185,689

124,689

-33%

Wrexham

Wales

193,032

131,565

-32%

Neath Port Talbot

Wales

139,852

96,377

-31%

Pendle

North West

136,476

94,382

-31%

South Staffordshire

West Midlands

240,447

169,085

-30%

Flintshire

Wales

187,151

132,108

-29%

Bassetlaw

East Midlands

162,656

115,468

-29%

East Ayrshire

Scotland

141,714

100,933

-29%

Inverclyde

Scotland

153,526

109,482

-29%

UK

228,251

172,427

-24%

Source: Halifax

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