UK house prices in 1% annual fall

House prices in the UK have recorded their first annual fall for 12 years, according to the Nationwide. Prices fell by 1.1% in April, the sixth monthly decline in a row, and were down 1% from the levels seen in April 2007, the building society said. Nationwide said the price falls reflected a weakening market which had been hit by "poor affordability and tighter financial market conditions". BBC News Play the video clip of the Chief Economist of the Nationwide.

An interesting article in the Guardian (A house of cards) where Rob Williams argues that we mustn't bail out the housing market but give it time to 'self-correct'. 'What we are witnessing is a long, long overdue return to sensible borrowing and responsible lending at levels consistent with historic trends. For younger readers, or financial illiterates, that means mortgages at about 3.5 times salary, together with the necessity of saving for a deposit.'

Who will be hardest hit by a fall in house prices? Will anyone welcome falling house prices? Will views change if house prices continue to fall?