House prices dip in December

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House prices in Britain dipped in December, mortgage lender Nationwide said, adding that the property market looks likely to remain sluggish next year as a weak economy and rising unemployment keep a lid on consumer spending.

House prices fell 0.2 per cent from November on a seasonally adjusted basis, although they rose 1.0 per cent from the same month last year. Analysts had forecast a monthly increase of 0.1 per cent and a 1.5 per cent annual rise.

“With the UK economy struggling to gain momentum, labour market conditions are likely to remain challenging in 2012, deterring buyers from entering the housing market,” said Nationwide chief economist Robert Gardner.

“The housing market in 2012 looks likely to be characterised by low levels of activity once again, with prices moving sideways or modestly lower over the course of the year.”

On Monday mortgage lender Halifax said the number of first-time home buyers in Britain fell to a record low in 2011, despite house prices declining to their most affordable levels in eight years.