Housing market 'to favour buyers'

Updated: 

for sale signsFive times more Britons think the housing market will favour buyers over the next year than those who believe it will help sellers, a study has found.

Halifax said its findings point to the market remaining subdued in the coming months, with less than one in 10 (9%) of people surveyed feeling positive about both buying and selling in the near future.

It found that 56% of people thought the next 12 months will be a good time to buy a home, but just 11% said it would be a good opportunity to put a property on the market. Just over a third (35%) of people expect prices to rise over the next year, compared with a fifth (20%) who expect them to fall.

A divide between regions in the south and the rest of Britain over house price expectations has also widened, with people in the south becoming much more likely to predict that prices will increase, the study said.

Those living in the South West were the most optimistic, closely followed by those living in London, while people living in Scotland and the East Midlands were the least likely to believe prices will increase.

More than half (56%) of people outside southern England said job worries were a major barrier to buying a home, compared with 48% of people within the south.

Halifax said optimism about price rises has slowly lifted compared with year ago, when slightly more people expected prices to drop than to increase. But most people still think any price change in a year's time will be relatively small, with two thirds expecting any movement to be within 5% and minus 5%.

Six out of 10 people believe raising a deposit is still a big challenge for home buyers and a third said mortgage availability remains a large hurdle.

A Government scheme to kick-start lending launched at the start of August has caused an increase in the number of mortgages on the market and has seen lenders slashing some rates, although much of the strongest competition has been aimed at borrowers with larger deposits.

Martin Ellis, housing economist at Halifax, said that the overall improvement in confidence over house prices reflects the fact that much of the market has continued to hold up relatively well amid the weak economy. He said: "We expect house prices to be broadly unchanged over the rest of this year and into 2013."

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