House Prices for 2007 and predictions for 2008
Posted on 30 January 2008 by
Land Registry figures for house prices out this week show that they were down 0.4% in December, which brings the annual rate of growth for 2007 was 6.7% according to their scale.
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The Halifax index showed the annual growth at 5.2%,
Nationwide's index showed it as 6.9%, and
Hometrack at 3%.
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As for projections for next year:
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Halifax predict 0%,
Nationwide an increase of 3.3%,
Hometrack an increase of 1%, but
Capital Economics predict a fall of 5%.
At Charcol, we think the figure is more like an average of 2% nationally.
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This means that it is vital for people who took a 95% or 100%+ mortgage last year to re-prioritise this year, and pay off some capital if at all possible. If you get into credit difficulties, you don't want to be in negative equity because you would not be able to sell the property to pay off your debt.
Falling property values are not as great a reason to panic as you may think: because if the whole market falls the property values remain relative to each other. In fact, if you are trading up, a 5% drop in value (for the sake of argument) on the larger property will save you more money that you are losing from the 5% drop in value of your own property, so a market-wide property value drop could work for many people.
Categories: Mortgages, House Prices
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