No growth in house prices as buyers stay away

Two new surveys show that prices are staying still as concerns about the wider economy continue.

Two new surveys paint a picture of a stagnant housing market. The Land Registry’s figures for December show no change in the average house price in England and Wales between November and December.

And the Land Registry figures show that prices have decreased by 1.3% since December 2010.

Property analyst Hometrack goes even further and says there has been no increase nationally in house prices for 18 months.  Its latest monthly report shows no growth in prices between December and January. A small increase in prices in London offset falls elsewhere.

Hometrack also says that concerns over the economic outlook and the Eurozone crisis have led to a 23% drop in buyers registering with estate agents between August and January.

The average time a property is on the market, according to Hometrack, is highest in the north and midlands at 11.9 weeks. It’s 9.1 weeks in the south of England but is 6.5 weeks on average, lower than its average at the start of 2011.

'A buyer's market where prices won't rise'

Another survey has found that the majority of people believe the housing market is a buyer’s market and most are pessimistic about prices rising this year.

Property website rightmove’s Consumer Price Forecast found that 60% of people surveyed think it’s now a buyer’s market.

And only 25.1% think prices will rise, a change in sentiment from last year, although fewer people think prices will fall by more than 10% than did last year. But 40.6% think prices will stay about the same.

There’s a distinct north-south divide in views, with more people in the south optimistic that prices will rise, while northerners are more pessimistic.

Of the optimists, a shortage of properties and an improving mortgage market are the main reasons they think prices will rise. Meanwhile, a lack of available mortgage finance and worries about job security are the top two reasons cited for prices falling.

Rightmove itself believes the market is even more fragmented, pointing to ‘micro markets’ within the main regions. Miles Shipside, rightmove director, says: “In these micro-markets, the combined impacts of demographics, employment and mix of stock go a long way to determining the local market confidence and, in turn, market performance.”

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