Growth in the UK residential property market is slowing as buyers put off decisions ahead of next month’s general election, according to the latest real estate price index published today. (Monday April 26)Reports propertywire.
But although the housing market is losing momentum prices are still rising. They increased by an annual 1.8% in April, their fastest pace of increase since January 2008, according to the figures from property data company Hometrack which surveys estimates of realistic selling prices from estate agents and surveyors.
But monthly house price growth slowed to 0.2% in April from 0.3% in March on a non-seasonally adjusted basis. And the picture varies across the country. April’s monthly rise was driven by a 0.6% increase in London, whereas prices in other regions were more typically flat or up by just 0.1%. And in Yorkshire and Humberside there was a 0.1% price fall.
The rate at which properties in England and Wales came on to the market also outstripped demand from new buyers for the third consecutive month, further reducing the recent upward pressure on prices.
Hometrack said estate agents were reporting that buyers were taking longer to commit to properties, with the number of viewings needed per sale increasing for the third consecutive month.
At the same time, the percentage of their asking price that sellers were achieving remained unchanged at 94%, ending a 13 month run during which it had increased, while the average time it takes a home to sell has plateaued at 8.3 weeks.
‘The supply of homes for sale continues to outstrip demand. ‘This is a trend that has been evident for the last quarter, but lies in stark contrast to the final months of 2009, when buyers far outnumbered the supply of properties for sale,’ explained Richard Donnell, director of research at Hometrack.
‘As the supply of homes for sale continues to outpace demand, so the impetus for price rises is set to wane,’ he added.
The general election is being cited as a factor behind the growing buyer uncertainty and has contributed to a sharp slowdown in the rate at which agreed sales were increasing, he said.
‘There has been evidence for some months that the supply/demand balance has been changing steadily, but the buyer slowdown has been exacerbated by the announcement of a May election,’ he explained.
