How confident are you in the state of the housing market? According to research from Halifax, you may not be as optimistic as you once were, with their Housing Market Confidence Tracker falling slightly during April.
The tracker revealed that just 63% of those surveyed expected average property prices to be higher in a year's time, down from the 67% who said the same in March. This is reflected in the headline House Price Outlook balance: the difference between the number of people who expect the average property price to rise compared with those who think it will fall slipped to a reading of +58 in April, down from +64 in March.
Essentially, this means that fewer people think prices will rise over the next 12 months, despite the fact that base rate remains on hold and average house prices are continuing to increase. It could also be assumed that record low mortgage rates would boost confidence further, so the fall in positivity is particularly surprising.
One explanation could be due that, although prices are rising, the pace of growth has slowed considerably in recent months. It's widely expected that house price increases will remain modest for the year ahead, which will come as welcome news to those looking to buy, and probably explains why people are increasingly optimistic about the buying landscape – the proportion of respondents who believe that the next 12 months will be a good time to buy has increased from +21 in March to +26 in April.
The positive market overall, together with other economic indicators such as rising employment levels and low inflation, hopefully points to the consumer outlook improving over the next few months, said Craig McKinlay of Halifax: "The fundamentals for the housing market remain positive. Going forward, the key factor in how consumers adjust to any changes in rates will be the way in which they manage their disposable income."
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