Home prices in the U.K. unexpectedly reversed losses in the first month of the year after winter weather disrupted activity at the end of 2010, although the trend appears to still be negative, according to The Daily Telegraph. On Friday, mortgage lender Halifax reported that the average cost of a home in the U.K. added 0.8% in January, rising to £164,173 after a 1.3% decline the previous month. However, the quarterly change in home prices was a slide of 0.7%, which brought the annual change in home prices to a 2.4% decline. The year-over-year decline was smaller than the 3% forecast by economists, and the lender said the pace of falling home prices was slowing.
A separate reporte from the Society of Motor Manufacturers and Traders showed that new car sales dropped 11.5% in January thanks to the expiration of an incentive program and the increase of the value-added tax. The slip brought the level of new cars sales to 128,811, and the SMMT chief executive Paul Everitt said, “This marks the beginning of a challenging year for the U.K. motor industry.” The outlook is especially bleak given what Howard Archer of IHS Global Insight called “serious headwinds facing consumers,” as public spending cuts loom, and Everitt urged the government to freeze a its duty on fuel to stabilize the industry.
Click here to read the story on home prices from The Daily Telegraph.
Click here for coverage of new car sales from The Daily Telegraph.