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House prices still rising

House prices still rising

Category: Mortgages

Updated: 26/04/2010
First Published: 26/04/2010

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Average house prices in the UK rose by 0.2% in April to stand at £158,400, the highest level seen since December 2008, new research has revealed.

Despite having slowed from the growth of 0.3% seen the previous month, the Hometrack survey has now reported a rise in prices for nine months in a row.

Key to the latest improvement was a 0.6% increase in the price of properties in London.

However, the proportion of the asking price being achieved by home sellers remained unchanged at 94%, the first time the measure has failed to rise in 13 months.

The general election has been blamed for the recent slowdown in price rises, with buyers thought to be increasingly uncertain as to what the future holds.

As a result, the supply of homes for sale continues to outstrip demand, dragging down the prices that sellers are able to achieve.

"It was clear that given the strong end to 2009 that spring 2010 was unlikely to compare with a traditional start to the selling year," said Richard Donnel, director of research at Hometrack.

"There has been evidence for some months that the supply/demand balance has been changing steadily but the buyer slowdown has been exacerbated by the announcement of a May election.

"The near term prospects for the housing market are intrinsically linked to demand which in turn is reliant on strong consumer confidence. The outlook for the economy and jobs market as well as household finances all impact on housing demand and buyer behaviour.

"With an election well under way, it is not surprising that buyers are currently hesitant in their decision making, the question is whether market sentiment will improve once the result of the election is known."

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