House prices continued to fall in July

The UK property market has performed reasonably well over the course of the last seven months, with 2012 having proved far better for homeowners than previous recession years.

However, it has now been reported that prices are falling, according to the latest figures which have been released by Nationwide.

The building society has found that the average price of properties for sale in the UK during July dropped as low as £164,389, which represented a 0.7 per cent decrease when compared to just a month earlier.

It was also indicative of a poor year-on-year figure, with the cost of housing in general dropping by 2.6 per cent when compared to July of 2011.

It was recently also reported by Hometrack that one of the contributing factors that are forcing the prices of properties marginally lower is the fact that the value of homes in London and the south-east of England, which have been the best performing areas in recent years, were starting to see a slowdown in their growth.

Other contributing factors could include the horrendous weather in June and July, sure to put off people from buying, and making the already traditional slower months of summer even worse for people looking to sell.

Robert Gardner, Nationwide's chief economist, said: “The weaker price trend observed in recent quarters is unsurprising, given the disappointing performance of the wider economy. Data released last week revealed that the UK recession intensified in the three months to July, with the economy contracting by 0.7 per cent quarter on quarter."

Mr Gardner added that the UK economy is now 4.5 per cent lower than it was at the same time in 2008.

However, he also went on to say that the poor state of the economy, compared to the fact that the price of homes dropped marginally, shows that the value of property has actually been quite resilient in recent months, and could recover when conditions improve.