What's happening with house prices?

Caroline Cassidy

Property is a hot topic for millions of home owners keen to know if their nest egg is gaining in value and for millions more looking for a chance to get on the property ladder. A recent poll showed that many Britons rate owning a home a higher priority than getting married or having children. Over 70 per cent rated the importance of home ownership as high as eight on a scale of one to ten. With the recent change in government the country will be watching the market carefully to see what the future may hold. Let's take a look at the latest indicators.

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Rightmove has revealed that the average asking price for homes increased by 0.7 per cent from April after climbing to 2.6 per cent. Some see this as a sign that prices may be cooling off after recent gains.

This is also reflected in recent figures which show that asking prices for property in London fell for the first time since December. This could be reflecting the fact that sellers have to reduce their prices as they chase a smaller group of buyers who are able to get a mortgage.

Lenders say the cold weather and removal of a stamp duty holiday on homes of £125,000 and £175,000 had weakened the market in the early part of the year. The effect of these problems could still be finding their way into official figures.

The National Association of Estate Agents (NAEA) and the Royal Institution of Chartered Surveyors (Rics) have reported a rise in the number of people putting their homes up for sale during March. The most recent official figures show the number of completed sales in the UK went up in February to 58,000, which represents a rise of 15 per cent from January

There are also significant differences in the way prices fluctuated across the country during March. In London and the northeast prices were up 1.6 per cent, while in the east they increased by 0.2 per cent.

The overall number of homes sold rose in February. Figures from HM Revenue & Customs (HMRC) show that the number of completed sales rose by 14 per cent from January, to 58,000 last month.

Figures from the Bank of England have shown that the number of new mortgages approved for home buyers fell from January to February showing that the property market seems likely to stay subdued for at least the next few months. This is consistent with many forecasters who believe that overall, the market will stay flat for the coming year.