UK hous­ing con­fi­dence strong, says Hal­i­fax

Financial Mirror (Cyprus) - - FRONT PAGE -

There has been a small rise in pos­i­tive sell­ing sen­ti­ment in the fi­nal quar­ter of 2015 and a fall in the num­ber who ex­pect it to be a bad time to sell, ac­cord­ing to the lat­est quar­terly Hal­i­fax Hous­ing Mar­ket Con­fi­dence Tracker in­dex re­port.

De­spite de­clin­ing steadily since last May, house price op­ti­mism in the fi­nal quar­ter of 2015 con­tin­ued to show that a ma­jor­ity, +61 com­pared to +68 in May, think prices will keep ris­ing with 13% be­liev­ing they will be at least 10% higher.

“Solid eco­nomic growth, ris­ing real earn­ings and falls in al­ready very low mort­gage rates are all stim­u­lat­ing hous­ing. At the same time, there is an in­creas­ingly acute im­bal­ance be­tween sup­ply and de­mand, which is caus­ing prop­erty prices to rise at a ro­bust pace,” said Craig McKin­lay, Hal­i­fax mort­gages di­rec­tor.

“This sit­u­a­tion, which is un­likely to re­verse sig­nif­i­cantly in the short term, is re­flected in the pub­lic’s con­tin­u­ing high lev­els of op­ti­mism re­gard­ing house price growth over the com­ing 12 months,” he added.

There has been a small rise in pos­i­tive sell­ing sen­ti­ment since last quar­ter, with 55% (+3) of peo­ple think­ing the next 12 months will be a good time to sell. By con­trast, there has been a drop in the pro­por­tion who ex­pect it to be a bad time to sell, down three points in the same pe­riod, to 29% now.

Pos­i­tive buy­ing sen­ti­ment has in­creased marginally, at 54% (+1), with neg­a­tiv­ity down two points to 31% while the pro­por­tion who think it would be a good time to buy and to sell prop­erty has risen to 39%, up three points on the pre­vi­ous quar­ter, while 15% of peo­ple think the next 12 months would be a bad time to do both.

The pro­por­tion iden­ti­fy­ing ris­ing prop­erty prices as a bar­rier to buy­ing a prop­erty has risen to 37%, up six points on the pre­vi­ous quar­ter and the high­est this fig­ure has been since the sur­vey’s in­cep­tion, with av­er­age UK house prices now stand­ing at £208,286 fol­low­ing a 10% in­crease dur­ing 2015.

How­ever, rais­ing a de­posit is still be­lieved to be the main bar­rier to buy­ing prop­erty, with 58% of peo­ple choos­ing this as a rea­son, up one point from last quar­ter). Job se­cu­rity is the num­ber two rea­son, at 42%.

Con­cerns about in­ter­est rate rises as a bar­rier have fallen, with only 11% of re­spon­dents men­tion­ing this, down five points from last quar­ter.

“Dif­fi­cul­ties in rais­ing a de­posit, con­cerns about job se­cu­rity and high prop­erty prices re­main the main bar­ri­ers to peo­ple buy­ing a home. The pro­por­tion iden­ti­fy­ing ris­ing prices has risen to the high­est in the sur­vey’s his­tory. The de­cline in af­ford­abil­ity that this high­lights is ex­pected to dampen hous­ing de­mand and prop­erty price growth over the medium term,” said McKin­lay.

Half think mort­gage in­ter­est rates will be higher in 12 months’ time, a drop from 58% in Septem­ber and ex­pec­ta­tions of a rise in sav­ings in­ter­est have also fallen, to 28% hav­ing been 35% in Septem­ber.

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