House prices 'unchanged in May'

Mortgage lending is at a record low, recent figures showed

House prices in England and Wales were unchanged in May and up 1.8% over the year, the Land Registry says.

But it said that sales volumes during March were half of the number of March 2007, at 53,080.

The figures, which are based on completed property sales, come after sharp falls in house prices were reported by the UK's major lenders.

The Registry said annual price growth fell for the ninth month running. The average cost of a home was £183,266.

Price changes

The data shows that London has the biggest year-on-year growth in property prices - up 6.9%.

There were also rises in prices in the East Midlands, the East, Yorkshire and Humber, the South East and the North West.

But average prices fell over the last 12 months in the North East, South West, Wales and the West Midlands.

At a more local level, Monmouthshire saw the highest annual price growth in May - at 6.9%, whereas in Ceredigion prices fell the most, by 7%.

Following the trend?

The figures painted a far more rosy picture for homeowners than lenders' data for the whole of the UK during the same month.

A series of house price reports will be published in the coming days

The Land Registry figures are based on completed sales across all lenders, unlike Halifax and Nationwide surveys which are based on an earlier stage in the buying process - when the price is agreed after a survey by their mortgage customers.

According to Halifax, UK house prices dropped by 2.4% in May, which pushed prices 3.8% lower than a year before.

Halifax, which is Britain's biggest mortgage lender, has since predicted that UK house prices would drop by 9% this year, a more severe fall than its previous forecast.

The Nationwide building society reported a 2.5% fall in house prices during May.

The surveys, and other research, all show a significant fall in the volume of house sales.

The Land Registry said there were an average of 61,950 transactions per month from December to March, down from the same period a year earlier when the average stood at 100,693.

The number of properties sold in England and Wales has dropped by about half from March 2007 to March 2008 across all price ranges.

This includes the £1m-plus bracket, with 646 luxury homes sold in March 2007, but 357 sold in March 2008.

Transactions have collapsed in the wake of the international credit crunch, as banks and other lenders found it very difficult to raise mortgage funds on the financial markets.

Earlier this week HM Revenue and Customs said the number of UK property sales had fallen by 32% this year.