North West house prices fell 1.06% in quarter three of 2010 but outperformed Yorkshire, Humberside and the North East which all saw greater falls, according to BNP Paribas Real Estate.
David Couch, director of Manchester development and residential consulting at BNP Paribas Real Estate, said: "House prices fell a little in the third quarter having staged a strong recovery from the spring of 2009. The current flatness in the housing market partly reflects the uncertainty in the UK as people contemplate the prospect of large public sector cuts. However, monetary policy will offset the fiscal tightening both in the UK and most of the other major countries. The market's relative strength must be attributed to the policy response that was invoked in the form of bank rescues and extreme monetary easing."
BNP Paribas Real Estate said house price growth in the final quarter of 2010 will reach 3.0% in the North West, with only Wales and Northern Ireland predicted to see higher increases.
Looking forward to 2011 the findings show that the UK will see nominal house price growth of 5.48%; once again growth in the North West will surpass the national average with an increase of 7.11% expected.
Couch continues: "Central banks are contemplating more quantitative easing whereby they will buy government bonds in the marketplace, effectively with new printed money. Unfortunately the banks are not responding to normal monetary measures because of their weak balance sheets and the belated attentions of the bank regulators, intent on slamming the stable doors well after all the horses have bolted. The regulator's timing is usually out of kilter; they should be easing up now and preparing to tighten up again in some years' time when, hopefully, the recovery will be firmly established."