x
By using this website, you agree to our use of cookies to enhance your experience.

TODAY'S OTHER NEWS

House price sentiment holds firm despite rate threat

The house price sentiment index in positive territory for 28th consecutive month with households in all UK regions saying property prices rose in July.

Londoners perceived the biggest rate of house price growth over the course of the month.

Expectations for future house price rises accelerated to a nine-month high in the South East, according to the latest House Price Sentiment Index (HPSI) from Knight Frank and Markit Economics.

Households in the South East and London expect the strongest price rises over the next 12 months.

The study also showed that 5.3% of UK households plan to buy a property in the next year.

Some 21.4% of the 1,500 households surveyed across the UK said the value of their home had risen over the last month, while 4.1% reported a fall giving the HPSI a reading of 58.6.

This was the 28th consecutive month that the reading has been above 50.

July’s reading was a slight decrease on the 59.5 recorded in June, although it remained the second highest reading so far this year, an indication that households across the UK are still confident that prices are rising.

Grainne Gilmore, head of UK residential research at Knight Frank, said: “Overall expectations for future house price growth remain firm, underpinned by a strengthening labour market, improving economy and ultra-low mortgage rates.

“There is now more discussion about possible interest rate rises, but this, as well as the property tax announcements in the July Budget, has had little impact on average expectations for the direction of travel for house prices.

“However, there are regional differences in the data, with the widest spread between the future HPSI reading in the North East and London than at any time since March last year, reflecting the differing dynamics of housing markets across the country, with local economic factors leading to a disparity in the levels of house price growth.”

Tim Moore, senior economist at Markit, said a gradual rebound in households’ property value perceptions has been underpinned by strong demand conditions so far this summer, alongside an underlying lack of supply and the continued low mortgage rate environment.

“These factors are likely to support house price momentum through the second half of 2015, although tighter mortgage lending rules and stretched affordability have brought down UK households’ expectations of future house price growth from last year’s record highs.”

icon

Please login to comment

Zero Deposit Zero Deposit Zero Deposit
sign up