House prices continued to fall in May, with the latest figures from the UK’s biggest mortgage lender Halifax revealing a monthly fall of 2.4% and an annual drop of nearly 4%.
The new figures – which confirm those already supplied by Nationwide – are likely to prompt calls for the Bank of England to cut interest rates later today.
Halifax says the falls are being caused by the lack of new buyers, many of whom are unable to secure credit from mortgage providers because of lending restrictions.
But the bank says the falls should be taken in the context of “significant gains” in recent years. UK prices increased by 79% over the five years to August 2007, with the average UK price up in value by more than £88,000 between August 2002 and August 2007.