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Housing market stabilises

Housing market stabilises

Category: Mortgages

Updated: 01/06/2009
First Published: 01/06/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Hometrack has reported in its monthly house price index that house prices stabilised in May, following 20 consecutive months of decline.

The improving conditions have been attributed to stronger sales volumes, continued buyer interest and a dwindling supply of property for sale, which has provided a short term boost to market confidence.

It is further evidence of tentative improvement in the sector, following figures from Nationwide last week that recorded a rise of 1.2 per cent in property prices in May, the second such increase in three months.

Price drops were only recorded in 13 per cent of postcodes throughout England and Wales, compared with 58 per cent in January and over 70 per cent last autumn.

The survey also reported encouraging rises in the number of sales agreed, up by nine per cent, while a six per cent monthly rise was recorded in the number of people registered with estate agents.

However, in keeping with recent commentary and expert analysis, Hometrack's director of research, Richard Donnell, said the overall outlook for the sector is still bleak.

"While house prices remain unchanged over May, the outlook for the housing market remains fragile with a number of factors that could well derail the recent pick up in market activity.

"Given the weak outlook for the economy, house prices are expected to remain under downward pressure for the foreseeable future," he commented.

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