UK Housing Market Price Increase Optimism at Low Level
Activity within the UK housing market started slowly at the beginning of the year and so far that trend continues. Original loan approvals are down and house price increases are sluggish. Remortgages however are moving at a more than moderate pace. Due to the mixed level of activity, house price optimism has taken a slide to its lowest level for 18 months, according to a recent survey. The level of optimism now sits at +52, which is a drop from 62. The last time the level was this low was June 2013.
Craig McKinlay with the Halifax commented on the current state of house price increase optimism, saying: “More than half of consumers still believe house prices will be higher than they are now in a year’s time; however optimism has continued to weaken. Despite this the fundamentals remain in place and we’re now seeing a return to the seasonal trend for house price activity.”
McKinlay added: “Traditionally, a slow start builds to the summer before another lull and then a further period of increase followed by a gradual easing at the end of the year. It’s widely acknowledged that the UK needs an increase in the amount of new housing being built.”
He continued: “The Lloyds Banking Group Commission on Housing targeted 2 to 2.5 million new homes built by 2025 new homes to be built before 2025. If we are to address demand the increase in new homes coming onto the market needs to be sustainable.”
Many within the housing market believe the amount of activity will spike after the general election.