Prices rising, transactions rising… but is it a recovery?
Latest figures from the property world suggest that the market is becoming increasingly active again. According to the LSL Acad E&W house price index, first time buyers have been active in a bid to beat stamp duty with transactions rising by 32% in March following a 10% rise in February.
David Brown, commercial director of LSL Property Services, said: “The bulk of the boost in activity came from first time buyers rushing to complete their purchases before the end of the stamp duty holiday. Although transaction numbers rose rapidly last month, the bulk of the activity was for properties below the £250,000 threshold. It’s also important to remember that the relatively stable national picture of house prices masks a far more volatile picture at a regional level. Although price growth has slowed in London over the last few months, the capital is currently the only region in which prices are rising. The price rises enjoyed by London homeowners mean the national figures do not reflect what have, in some areas, been relatively steep price falls, with the north of England a notable example, showing annual price falls of 6.1%.”
According to Winkworth, first time buyers are expected to suffer from the ending of the stamp duty holiday, while the middle market of family homes in Greater London is showing signs of revival. Meanwhile sales at haart rose by over a third last month. Their best performing areas of the country were London and the South East followed by the East Midlands and East Anglia. The top performing individual branch was Colchester which has seen sales rise by 22% since the start of the year.
It comes as the Rightmove House Price Index suggests that London and South West are helping to push national asking prices to new record highs. Their latest results show:
* a rise of 2.9% (£6,798) in April helped national new seller asking prices to reach an all-time high of £243,737
* London prices have grown 14.9% (£60,403) since the national peak in May 2008 while new sellers’ average asking prices in the rest of the country have fallen by 4.3% over the same period
* since the high of May 2008, the four best performing regions in terms of price are London, South West, South East and East Anglia
* Retail price inflation of 11.5% since May 2008 means that national average asking prices are still down in real terms by 9.9% over the period
“This is not a universal signal of a housing market recovery,” warned Miles Shipside, director of Rightmove. “The richest seams of housing market activity are concentrated around those with access to cash and finance, with a strong bias to the south and London in particular. Even within regions there are micro-market hotspots where demand from those that can buy and the confidence and momentum it engenders are helping to push asking prices to new record highs. It’s a somewhat perverse state of affairs for many of the mass-market not
deemed as mortgage-worthy by the lenders that, at a time when many aspiring buyers are excluded, the national average price of property coming to the market is at an all-time high”.
He underlined that with local market conditions varying considerably, researching the local micro-market was particularly essential to gauge what type of property is in demand, how quickly it is selling and how close to the asking price is being achieved.
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