Market Information
The Hometrack May survey of the national housing market reports a
further fall of -0.1%. This is the eleventh consecutive month that
house prices have fallen. However, over the last three months house
price falls have only been decreasing at a rate of -0.1% per month,
which suggests that the market is stabilising. Prices now stand at
£161,900, down from a peak of £167,700 in June last year and down
2.3% over the last 12 months.
In contrast to the ongoing house price malaise, housing market
transactions have seen a further marked improvement. Sales agreed
have risen by 7.6% this month (9.4% in April's survey),
suggesting that the market is turning the corner. This increase in
activity is mainly due to an increase in the number of buyers coming
back to the market of 2.2% (5.4% in April's survey). However, as
the number of new instructions continues to increase, an oversupply
of properties means that it is still a buyer's market and prices
are still decreasing.
Sales price as a percentage of asking price has increased slightly
this month to 93.6% (93.3% in April's survey) indicating that
house price deflation has resulted in more realistic asking prices.
The amount of time it is taking to sell a house has stayed stable at
7.4 weeks, whereas 12 months ago houses were taking just 4.1 weeks to
sell. Properties are sticking on the market as buyers have a lot more
choice due to the back log of properties registered with estate
agents. The average number of viewings has slightly increased to 12.5
(12.4 viewings in April's survey).
19 counties have seen price rises or remained static this month, and
38 have seen price falls. The counties at the top end of the scale
are Central London & City (0.2%), London Â- North (0.2%), Essex
(0.1%), London Â- South East (0.1%) and Northamptonshire (0.1%). The
counties reporting the largest falls are South Lincolnshire (-1%),
Shropshire (-1%), North Yorkshire (-0.8%), London Â- North West
(-0.7%) and Derbyshire (-0.5%).
No post election bounce as house price stagnation continues - cont...
Of the cities, 34 have seen price rises or remained static whereas 20
have seen price falls. The top five are Hull (0.6%), Chester (0.3%),
Cardiff (0.1%), Exeter (0.1%) and Bath (0%). The cities reporting the
worst falls are Shrewsbury (-3%), York (-1.3%), Swindon (-1.3%),
Lancaster (-1.2%) and Gloucester (-0.8%).
John Wriglesworth, Hometrack's Housing
Economist, comments:
"House prices are falling like drizzly spring rain, slowly and
over most parts of the country. While there is no sunny outlook in
prospect, there are no signs of a gathering storm either. The
forecast for the next couple of months looks set to remain dreary.
"On the economic front, however, with new expectations of lower
interest rates and ongoing rising incomes we expect a mild recovery
in the second half of the year. Homes are still affordable, and
mortgage lenders are offering very competitive deals. All the market
needs is a spark of consumer confidence which will extinguish
misplaced fears of significant house price falls. The ongoing market
malaise has caused us to revise our house price forecast for 2005
from 3% to 0%. The year looks set to end as it began in terms of
house prices, as flat as a pancake."
