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UK house prices continued to slide in July

1st August 2012 Print

UK house prices declined for the fourth time in five months in July, with prices falling by 0.7%, according to the Nationwide House Price Index. This pushed the annual pace of price growth down to -2.6%, from -1.5% in June - the weakest outturn since August 2009.

Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said: "The weaker price trend observed in recent quarters is unsurprising, given the disappointing performance of the wider economy.  Data released last week revealed that the UK recession intensified in the three months to July, with the economy contracting by 0.7% quarter on quarter. This disappointing outturn can be only partly explained by unusually wet weather and the impact of an extra bank holiday during the quarter. Indeed, the UK economy has contracted by 1.4% over the past nine months, and is now 4.5 percentage points smaller than it was in Q1 2008.

"Against this difficult economic backdrop, it could be argued that UK house prices have shown resilience. While prices are currently 13% below their 2007 peak, this is less than the declines seen in a number of other economies that have experienced similar or more robust economic recoveries."