According to Jones Lang LaSalle's latest Residential Market forecast, average UK house prices have started to slide with annual growth currently at 6.6%, down from a peak of 10.5% in April 2010.
During the remainder of 2010, Jones Lang LaSalle expects a decline of 3.9% on current price levels, reducing the value of the average UK property by £6,500 (7,900).
James Thomas, Head of Residential Development and Investment at Jones Lang LaSalle, said: "We are definitely seeing definitive signs of a slowdown in capital growth across the UK housing market. The simultaneous impact of weakening buyer demand and the increased level of property available for sale continues to place a downward pressure on pricing. While we are not expecting average house prices to fall dramatically, we are predicting a degree of pricing stagnation in the short term until the economic picture brightens. As a result, sellers will be forced to adopt more flexible pricing strategies over coming months as the balance of power once again shifts in favor of buyers."
Looking ahead to 2011, Jones Lang LaSalle expects increased supply and spending cutbacks to mean that price growth for the year will be flat, as the effect of public spending cuts and concerns around employment prospects pushes out the recovery timescale.
Rob Bruce, Head of Residential Research at Jones Lang LaSalle, said: "Demand is likely to be the buzz word across all regions of the UK in the short-term, with the latest austerity measures primed to take hold. However, the longer term outlook for the UK housing market is more positive with significant growth anticipated by 2012 and pricing gravitating towards the long-term average of 7% per annum."
Source: JLL
