Confidence in the outlook for house price growth hit its highest level in four years following the general election in May - but now its dropping back again according to the Halifax.
Its confidence tracker optimism shows a dip in public confidence in June despite continued rise in real wage growth, together with record low numbers of homes available for sale pushing average house prices over £200,000 for the first time ever according to the Halifax’s own index.
Nevertheless, while the May high was short-lived, the percentage of Britons predicting an increase in the average property price of more than 5.0 per cent over the next 12 months has still risen from 34 to 38 per cent in the last quarter.
With Bank of England governor Mark Carney suggesting that an interest rate rise has moved closer, 48 per cent of people expect mortgage interest rates to be higher in 12 months’ time.
Londoners are less likely than those in any other region to say it is a ‘good time to buy’ (38 per cent of Londoners say this compared with 56 per cent of Britons overall), making it the only region where the proportion who think the next 12 months will be a bad time to buy exceeds the proportion who think it will be a good time.
“A key factor in maintaining optimism over house price growth has been the fact that the stock of homes available for sale is currently at record low levels. If this growth is to be sustainable then we need to see a comprehensive house building plan rolled out across the UK, and soon” says Martin Ellis, housing economist at Halifax.
The survey shows that raising a deposit is still seen as one of the main barriers to homeownership (55 per cent mention this), ahead of job security (47 per cent) and rising property prices (35 per cent).