The UK housing market is experiencing its biggest slowdown since the early 1990s

The housing market is experiencing its biggest slowdown for 12 years according to the Nationwide. It reported a drop in house prices for the fifth consecutive month and predicted a continuing fall in values in 2008.

The Nationwide survey showed that the average UK house price had fallen slightly to £179,110.

Fionnuala Earley, the building society’s chief economist, said that the Bank of England may announce a rate cut as early as next month. She said: “Since the last meeting, the collapse of Bear Stearns and the fallout from false rumours of problems in a major UK Bank may have helped to shift the focus of the monetary policy committee to the need to loosen conditions in the financial markets”.

Despite the slowdown prices are still 11% higher than two years ago and 47% higher than five years ago.