House price slump highlighted by Halifax survey
- 18 February 2012
- From the section Business
Average house prices have risen in just two local authority areas since the UK's property boom peaked in 2007, research suggests.
According to the Halifax bank, the only two areas to increase were Rochford in Essex and South Lakeland in Cumbria.
Sixteen of the top 20 best performing areas were in southern England.
The report said exceptions included holiday and retirement areas such as South Lakeland, the Derbyshire Dales and Ceredigion.
Even in the areas that saw an increase, the rises were "marginal" according to the report - 1% in Rochford and 0.1% South Lakeland.
Aberdeenshire, which has been boosted by the strength of the oil industry, is among the best 20 performing areas despite prices dropping by 7% there.
Prices have fallen by just under a quarter across the UK since the peak of the property boom, to an average of £172,427.
The nine worst performing areas were all in Northern Ireland. In Craigavon prices more than halved from an average of £213,844 in 2007 to £103,383 in 2011.
The report said: "Prices have fallen sharply in Northern Ireland following the remarkable - and ultimately unsustainable - gains in the few years leading up to 2007.
"Average prices in Northern Ireland were the highest in the UK outside London and the South East in 2007. Northern Ireland now has the lowest average prices of any region in the country."
The district of Hart in Hampshire, previously named in a quality of life study by the Halifax as Britain's most desirable location to live, was one of the top-performing areas.
However, there were big falls in Wrexham, Neath-Port Talbot and Flintshire in Wales.
Martin Ellis, housing economist at the 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."
The Land Registry, the government department responsible for recording property ownership, has said that house prices in England and Wales fell by 1.3% in 2011 to an average of £160,000.
The only region where prices rose was London, where the average cost of a home went up by 2.8% to £345,000.
Prices fell fastest in the north east of England where they dropped by 7.1%, bringing the regional average down to £99,000.
House prices have been depressed by a combination of rising unemployment and continued mortgage rationing.