Propertyfinder.com reveals supply worries easing
The main findings of the February survey were:
– 70 per cent of house hunters expect prices to rise over next 12 months
– Supply of property is up, easing the shortage of available stock
– Sellers and buyers see stronger market ahead
The survey has revelaed the largest jump in confidence in the housing market since May last year when confidence rebounded after a marked pre-election nosedive. Confidence is now back to levels not seen since early 2004, when Mervyn King, chairman of the MPC, warned that the house price falls should be expected.
70.5 per cent of respondents now believe the housing market will rise over the next twelve months, up from 62 per cent in January. On average, propertyfinder.com’s survey shows that house hunters expect prices to rise by 4.0 per cent. This contrasts to the November 2004 low when 67 per cent expected prices to fall and by eight per cent on average.
Jim Buckle, chief executive officer of propertyfinder.com, commented: “All our indicators point to a healthy, balanced housing market which is good news for everyone. A confident market dispels the fear factor from the decisions that people need to make over their homes. What’s more, modest price increases broadly in line with earnings growth mean that affordability is not being stretched any further.”
Propertyfinder’s survey also revealed a sharp increase in supply of new property coming on to the site with stock rising 9.6 per cent in February. From July to November of last year, sellers reported that their homes had been on the market for an average of 12 weeks. In January, sellers reported an average of eight weeks and 8.7 weeks in February. This reduction means that more new property is coming up for sale. Normal seasonal patterns account for some of this increase but this is still a 33 per cent improvement over the equivalent period in 2005.
Jim Buckle added: “Shortage of supply has been a key problem in the market in recent months, so it is a good sign to see that things are improving so well. It is important to remember that two thirds of sellers are moving up the property ladder and are therefore also buyers. If they believe prices are going to rise, they have an interest in moving sooner rather than later, paying less to reach the next rung on the ladder.”
Sellers and buyers are in complete agreement on the outlook for the market. 80 per cent of both buyers and sellers are optimistic on prices, and both groups predict price growth of 4.2 per cent.
Jim Buckle concluded: “When sellers and buyers agree, the outlook for turnover in the market is good. The current picture adds credence to our view that transaction volumes will continue to recover.”