British house prices plunge at record annual pace: survey

LONDON: British house prices slumped by a record 14.9 percent in the three months to November compared to a year earlier, the country's biggest provider of home loans said Thursday in the latest sign of a growing recession.

Prices also fell 2.6 percent on a monthly basis from October to November, cutting the average price of a house to 163,605 pounds ($237,650, 188,760 euros), said the Halifax, which is part of British bank HBOS.

The annual figure was the largest drop since the series was launched in 1983, while the monthly decline was the biggest since September 1992.

"The combination of high house prices in relation to earnings, constraints on householders' incomes and spending power and the decline in the availability of mortgage finance since the summer of 2007 has curbed housing demand," said Halifax chief economist Martin Ellis.

"These factors are major contributors to lower house prices and activity."

Lower house prices, however, mean that a key housing affordability measure, the ratio of house prices to earnings, was at its most favourable for more than five years, the Halifax said.

Despite recent sharp house-price falls, the average home costs 124 percent more than ten years ago, when it was worth just 73,129 pounds, the bank added.