Nationwide vv Land Registry

The Nationwide numbers out today record house prices rising 0.4% on the previous month and unchanged over 2010. This is in contrast to the Land Registry numbers published yesterday who marked prices down 0.6% on the month leaving a net 2.2% gain over the year in England & Wales.

With such small volumes of sales it is perhaps more sensible to look at the Land Registry numbers which are based on most of the 50,000 properties that sold rather than just the 10% sample that the Nationwide may have handled.

The Land Registry marked prices down 3.3% in Wales and down 2.3% in the North East over last year but up 3.6% in South East and +6.8% in London.

In the Capital prices in Camden were up 13.2% over the year but down nearly 1% over the last month in both Hammersmith & Fulham and Southwark.

Sales volumes fell again down 6% on September 2009 across England & Wales and by 1% on London. These are the really worrying statistics. New homes are now coming onto the market at the rate of just 2,708 a day with 2,500 selling. This balance will help prop up prices in early 2011 although there remain significant challenges in the year ahead.

The gap between ‘average asking prices’ recorded by and ‘average sale prices’ (from the Halifax) is currently falling from a peak of £72k reached in May to a more comfortable £57k at the end the year. The long term average is £52k.

Most pundits expect prices to fall by between 2 and 3% over the next year. If there is such a thing as ‘the average house’ that carries the burden of the monthly prognostications from the likes of Halifax and others then I submit that it is 10-15% over priced. As a result, I am more bearish than my collegues and wouldn’t be surprised if the main indices were down by as much as 10% by Christmas 2011.