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House prices fall 1.6 percent year-on-year

A man walks past property for sale and rent in Timperley, northern England, November 1, 2010. REUTERS/Phil Noble

LONDON (Reuters) - House prices in England and Wales fell for a sixth consecutive month in December to stand 1.6 percent lower than a year ago, property data firm Hometrack said on Monday.

The firm, which asks estate agents to give achievable selling prices for different types of homes across the country, said prices fell 0.4 percent on the month. That was half the drop seen in November but enough to mean 71 percent of postcodes registered price declines over the course of 2010.

Hometrack said it expected further house price falls of 2 percent over 2011 -- similar to that predicted by the Royal Institution of Chartered Surveyors earlier this week.

Hometrack’s figures are not adjusted to take account of seasonal trends in the housing market but chime with other surveys in showing hefty public spending cuts and an uncertain economic recovery weighing on sentiment.

Britain’s government has embarked on the toughest spending squeeze in generations in an effort to reduce the budget deficit, and economists reckon almost half a million public sector workers could lose their jobs over the next four years.

“Weak demand and falling supply will be the defining features of the market,” Hometrack said. “Lack of mortgage finance and falling consumer sentiment are trends that will continue into 2011.”

The survey found that over the course of 2010 the supply of homes grew by 24 percent while demand fell by 7 percent. The average time taken to sell a property in December was 10 weeks, the longest since April 2009.

Reporting by Christina Fincher; editing by Stephen Nisbet

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