17
Feb
The Times says UK house prices jump 3.2 per cent in four weeks
Asking prices increased by 3.2 per cent in the four weeks to
February 6, research indicated today. The jump was the biggest rise
for homes in England and Wales since April 2007, according to data
from Rightmove.co.uk, the property website.
It pushed the average cost of a home up to £229,398 –
6.1 per cent higher than a year earlier – while asking prices
in London climbed to a record high of £427,987.
However, Rightmove said that the economic fundamentals could not
support further price increases of this magnitude.
Moreover, the company cautioned that in some cases the rise may
have been caused by estate agents going along with sellers’
perceptions of what their property is worth in order to win
business.
Miles Shipside, of Rightmove, said: “A price jump of over
3 per cent is comparable to the pre-credit crunch boom-times.
“Sellers are setting their sights higher, and some agents
are going along with them in order to win scarce
instructions.”
He added that the number of homes for sale was beginning to
increase slowly, with 90,000 new listings added to Rightmove over
the period.
This was nearly 20 per cent higher than in January 2009,
although figures for that month were distorted by the introduction
of a ban on marketing a property until the seller had a Home
Information Pack.
But despite the improvement, new listings remain 37 per cent
below levels seen for Januaries between 2005 and 2008.
Some areas also continue to have an acute supply shortage, with
stock levels 45 per cent and 43 per cent lower in East Anglia and
the South East respectively than between 2005 and 2008.
The Rightmove data is not the only indicator of possible
recovery. The National Association of Estate Agents (NAEA) reported
last week that its members sold an average of six properties in
January, compared to five in December.
Gary Smith, of the NAEA, said: "Our figures suggest that
concerns expressed about the prospects for the market in 2010 may
prove unfounded.
"This appears to be confirmed by the increased level of sales,
which given the awful weather conditions is quite amazing. The
dwindling housing stock on our members' books reflected the
increase in sales month on month, but this is a worrying trend that
if continued will result in further upward pressure on prices.
"More encouragingly, the very important first time buyer section
of the market now makes up almost one in four purchases. This
confirms their confidence in the market as well as their ability to
obtain attractive mortgage deals."
However, the Royal Institution of Chartered Surveyors reported
that the number of sales recorded per surveying firm fell from 19
to 18 in the same month, while the sales-to-stock ratio, which it
describes as "a measure of market slack and a lead indicator of
future prices" fell for the second successive month.
Ian Perry, of RICS, said: "The cold snap in January clearly has
a huge impact upon both supply and demand in the housing market
with activity coming to a halt amidst the seasonal chaos. Activity
and interest is likely to pick up in the coming months as the
market experiences a spring bounce.
"House prices are likely to rise in the short term but if more
supply continues to come on to the market, it is possible that the
market will run out of steam in the latter part of the year."
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