How was August for you?

My usual summary of the main housing numbers. These are the facts, you decide what they mean.

Q. How far have house prices fallen below their peak?
A. 16% according to the Halifax and 9% according to the Land Registry.

Q. Have sale volumes recovered?
A. They are 21% better than last year but still 24% below the long term average.

Q. Are there more homes for sale than usual?
A. No, the total number of homes for sale is up 36% on August last year and the number coming onto the market every day is also up, by 23%.

Q. What’s the gap between average asking prices and average sale prices?
A. £62,344. The usual gap is £43,675.

Q. How many homes sold for over £1m last month?
A. Nearly twice as many as last year.

Q. When was the peak of the market for house prices?
A. In June 2007 according to the Halifax and January 2008 as far as the Land Registry is concerned. Asking prices peaked three months later in April 2008.

Only 85,000 homes sold across the UK in August. If you have your home on the market then you have just an 8% chance of selling it in October. This month we’ll see just where the spending axe will fall and therefore what the outlook for property may be. The balance of commentators are bearish with Morgan Stanley warning of falls of up to 18% in the next 14 months.

One thing we can be sure of is the negative impact the FSA investigation into mortgage lending could have. Published in July the report revealed a shocking 43% of loans were ‘self-certified’ or so called ‘liar-loans’. The FSA has indicated that it will move to ban these removing roughly 35% of all demand (remember that 30% of all sales are cash deals not reliant on a mortgage) which could decimate estate agency businesses many of which are already suffering from low volumes.”

Low volumes could be the Achilles heel of the housing market. Agents will scuffle for instructions leaning on vendors to drop their prices to attract the attention of the few remaining ‘qualified’ buyers. Distressed or forced sales will form a larger percentage of the fewer total sales which will all be at lower values as buyers assert their authority. These fewer, cheaper transactions will determine the value of the nations remaining 24m properties.