UK Property news round up for the week:

Gloom and doom in June

UK house prices fell by 2% in June, according to the UK's biggest mortgage lender, the Halifax. However the latest survey conducted by Nationwide shows that house prices fell by 0.9% on average in June. Contradictory, as always.The average price of a home is now £180,344, nearly 10 per cent lower than when house prices peaked in August last year. Homeowners who bought a home last year with little or no deposit are now facing negative equity. However, average UK house price remains 2 per cent higher than in June two years ago and more than 10 per cent higher than in June 2005, according to Halifax. A pretty clear indication that the British housing sector still has some way to go before it reaches an all time low.

(Graph Source: BBC News, 1 July 2008)

Several job cuts in house building sector

The latest of the UK House Builders to announce job cuts is Barratt Developments. After a tough couple of months and an even more challenging period ahead, they’re looking at cutting 1,200 jobs by closing two divisions and merging other parts of their business. Earlier in the week, well-known home builder Persimmon announced that the company will reduce its full-time headcount by 1,100 and its flexible workers by 900, cutting its total staff from 5,000 to 3,000. They admitted that profit margins had fallen from 20.8 per cent in the first half of last year to just 14 per cent in 2008. The sector's jobless toll is touching 4,500 so far this year.

Banks set 5% mortgage

Borrowing costs remain unchanged for the third month in a row by Bank of England. Following their latest meeting, Bank of England has decided to keep the interest static at 5%. . Homeowners and businesses hoping for an interest rate cut as economic crunch bites are unlikely to get any joy from the policymakers.

More Falls?

Another recent forecast by Halifax predicts that UK house prices are set to fall by 9% this year - having revised their views from February that the market would be "flat" in 2008. Things seem to be going from bad to worse in the UK property market but some people are still optimistic. A list of the ten most recession-proof UK counties was published by the Times earlier yesterday. The top three resilient counties which didn’t get affected by the economic hit were Oxfordshire, Hertfordshire and Isle of Wight. City of Westminster house prices were up by a whopping 26.4%. The list was based on the asking prices of homes on Rightmove.co.uk, which displays details of around 90 per cent of all property sales across England and Wales. Looks like the housing market might not be so bleak after all!