Everybody from Business Secretary Vince Cable to the RICS may be panicking about a housing price bubble, but consumers don't share their concerns.
Just 2% of consumers fear the housing market is overheating, according to the latest Property Tracker report from the Building Societies Association.
Yet the report also showed a strong rise in market sentiment, with more than 60% of people believing house prices will rise in the coming year, the highest proportion since the survey began in 2008.
The perceived barriers to buying a property have also declined. Now only 39% of people see access to mortgage finance as a barrier to buying a property, down from 46% three months ago, and 60% in 2011.
The growing number of mortgages for people with deposits of 10% or less is finally beginning to make a difference, along with positive media coverage about the housing market, said Adrian Coles, director-general of the BSA. "Signs of recovery in the market have been much discussed over the summer and these results confirm an improved outlook.
"We are however, still clearly in recovery mode; and the cautious words of those who have been sounding warnings about a market already at risk of overheating need to be listened to, but it would be wrong to take any steps at this point that might damage the recovery in its early stages.
“In our last report in June 2013 we warned against the risk of a housing bubble if a clearly defined exit strategy to the Help to Buy scheme is not implemented by Government.
“At the moment, sentiment across the UK, particularly outside London, is increasingly positive, but still cautious. The hope is that the mix of consumer sentiment, additional house-building, mortgage availability and government intervention will lead to an improved but stable market.”
Ben Thompson, Managing Director, Legal & General Mortgage Club, said: “These results continue to look better and certainly reflect the improving market conditions we have seen through 2013. It is also interesting to note how unconcerned consumers are with regard to a potential housing bubble, versus one or two views of politicians and other key commentators. While you would expect a lag effect as industry experts will inevitably think further ahead than consumers, this does reflect a more realistic image of how consumers really feel, and that many think things are far from overheating right now.
"It is encouraging to see how much better consumers feel about their prospects of borrowing to buy a home. Although a positive shift in consumer confidence will have helped this, there can be little doubt that first the Funding for Lending Scheme and the first part of Help to Buy have helped greatly, and at the right time."
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