The figures of mortgage lenders have shown that in the last 4 weeks house prices were same as they were in October. Seeing the growth rate of property values every year fell from a little over three per cent to two and a half per cent. Nationwide said the return to flat prices was attributed to the cut in the interest in the month of August, instead of a return to the rise in the prices witnessed in the early years of the 21st century.

Nationwide group economist Fionnuala Earley said that the strong rebound in prices was temporary, which was driven by buyers postponing purchases until after the August rate cut, and the overall situation remains one of stability.  This return to stable prices means the median price of a UK property is now 157,139 pounds- almost identical to what it was in May. 

Since, the earning growth is going strong and the prices of houses flat, it could take not more than 4 years to when the houses return to their old levels of affordability.  The present pattern of small increase and small reduction means that there’s almost no chance of  house-prices going low.  She said that rapid cooling of house price inflation from 20 per cent between 2002 and 2004, was the cause for the commentators to predict a severe corrections to the marlet in the year 2005 with house prices going down, as the confidence in the market evaporated. 

She said that the data over the last six months showed that the house price inflation has established itself at zero to two per cent.