Half confident of house prices rise

%VIRTUAL-SkimlinksPromo%HalifaxConfidence among Britons that house prices are set to rise in the coming months has soared to its highest level in at least two years, a report has found.

News that the market appears to be turning a corner is having an impact on the public mood, with more than half (52%) of people now expecting prices to rise over the next year while just 12% are predicting a fall, Halifax said.
The overall reading of 40, made up of the percentage of people forecasting an increase minus those predicting a drop, is the strongest since the tracker began in spring 2011. One in four (24%) of those surveyed expect house prices to rise by at least 5% over the next 12 months.

The majority of people expect prices to rise across all regions. Confidence is strongest in London, which recorded a net balance of 69, followed by the South East. People living in the North West, the East Midlands and Wales were found to be the least confident about an upturn in prices.

In an indication that house sales could climb higher in the coming months, nearly one quarter (23%) of people think the coming year is a good time to both buy and sell a home, up from just 16% three months ago.

Lenders, estate agents and property websites have all been reporting signs of surging activity in the housing market. Experts have said that increased mortgage availability and a growing appetite among lenders to give the go-ahead to more low-deposit deals have helped to drive this.

The Council of Mortgage Lenders (CML) reported on Friday that first-time buyer numbers are at their highest for five-and-a-half years, which should help to get more housing chains moving.

Government measures such as Funding for Lending, which gives lenders access to cheap finance to help borrowers, have been introduced to kick-start the market, but analysts have warned that these must not lead to a house price "bubble" with borrowers overstretching themselves.

Martin Ellis, housing economist at Halifax, suggested that the confidence boost is "partly due to house prices being stronger than expected in the first half of the year". He added: "We continue to see a clear North/South divide with significantly higher proportions of people expecting prices to rise in the South than elsewhere in the UK."

Nearly 2,000 people took part in the research in June.

© 2013 Press Association
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