Walsall People: House prices stay stable year-on-year
Wed 07 Nov 2012
House prices rose by 0.6 per cent in October, more than offsetting a 0.4 per cent decline the previous month, lender Nationwide said.
The report said monthly prices had failed to show any strong trend over the past half year, with three months of price increases and three months of falls since May.
But it concluded that the housing market overall continued to be relatively stable, with year-on-year house price growth remaining within either plus or minus 1.5 per cent on all but two occasions over the last two years.
And that 'stability' was stressed by Nicola Moore, the branch manager for national agency Connells inLichfield.
"It's a similar picture for many of our branches," said Nicola.
"Properties are selling if they are priced right - and those prices have remained very stable for a good while now - but we would all like a few more people coming through the door".
"Things are certainly moving in the right direction, thought", she added.
And Nicola's comments were backed up by Land Registry figures last week which showed an increase in the number of house sales compared with 2011 - with the WestMidlands leading the way with a 17 per cent rise in property transactions lasst month as against 12 months ago. On average, 55,000 houses have been sold each month across the UK this year.
The Nationwide survery revealed that the average price of a UK home in Octover was 164,153 - just a few hundred pounds down on the average 12 months ago.
Despite figures last week showing an end to the longest double-dip recession since 1950, Nationwide said the economic recovery was likely to remain "fairly sluggish" as households tried to repair the state of their finances rather than spend.
RobertGardner, Nationwide's chief economist, said: "The situation is likely to remain challenging in the housing market.
"Although the UK has been adding jobs in recent quarters, even in the midst of recession, conditions remainvery difficult for households.
"Wage growth is still not keeping up with the cost of living and unemployment is still well above normal levels.
"This helps to explain why housing market activity has remained subdued, with the number of mortgage approvals still running at little more than half their long-run average."
An 80 billion Government scheme to kick start lending was launched at the start of August, which has caused an increase in mortgage availability, although lenders have toughened their borrowing criteria, making it harder for people to take a deal out.
Inflation eased to its lowest level for nearly three years in September, but experts predict the pressure on households will increase in the coming months amids rising energy bills and food costs.
Mr Gardner said:"Housingmarket conditions are likely to remain fairly subdued until there is a sustained improvement in the wider economic environment."
In a sign of what is to come, British Bankers' Association (BBA) figures recently showed that mortgage approvals for home buyers reached a five-month high in September, but they still remained below the levels seen last year.
The BBA said households have"no appetite" to take on more debt and demand for loans remains weak amid the uncertain economy.
However, there was cause for optimism in another set of housing market figures as the number of buyers registering with estate agents increased by 0.3 per cent in October, following four months of falling demand.
Despite the recession, the number of property millionaires has risen in London. Marsh & Parsons' latest London Prime Market Monitor shows that prime homes in London, with a cost of more than 1 million, have gone up in value by eight per cent.
It said that September 2011, 34.6 per cent of prime London properties costing more than 1 million, but this figure had now risen to 43 per cent.
Peter Rollings, chief executive officer of Marsh & Parsons, said: "Properties no longer have to be palatial to be worth 1 million if they are located in a prime London area."