House prices stable amid strong buyer interest
House prices remained steady in January and February according to property analysis firm Hometrack, but there was a surge for interest from potential buyers.
The firm’s Monthly National Housing Survey found that property values fell across six regions, remained the same in three, and grew by just 0.1 per cent in London, in the first two months of the year.
However the number of potential house buyers registering with estate agents grew by 18 per cent in February, as people rushed to buy a property before the re-introduction of the 1 per cent stamp duty on properties valued between £125,000 and £250,000, on 24 March.
In the south east the number of first-time buyers grew by 28 per cent and by 22 per cent in the south west.
Hometrack reported an increase of just 1.5 per cent in the number of homes for sale, over the past six months.
The shortage of homes helped 92.9 per cent of sellers achieve the asking price for their property.
Richard Donnell, director of research at Hometrack, said: ‘With many buyers doubling as sellers, the stock of housing coming to the market grew 10 per cent over the month.
‘However, as investors and first-time buyers have no properties to sell, the growth in demand out-paced the increase in supply across the regions.”
Meanwhile, the financial advisory group Collins Stewart has warned that the housing market could suffer a ‘lost decade’.
The firms also said that the Government’s conviction that there is a housing shortage in the UK is based on flimsy evidence.
Collins Stewart is critical of the government’s Mortgage Indemnity Guarantee Scheme, which offers 95% home loans on new build properties.
The scheme follows “a long trail of policies that have distorted the market, lumbered first time buyers with negative equity and have arguably distorted competition by disproportionately propping up the top few housebuilders,” the firm said.