3 years of property price negativity ends

Any figure under 50 indicates that prices are falling, and the lower the figure, the steeper the decline. Any figure over 50 indicates that prices are rising. 

The overall index reading for the UK was 58.4, up from February’s reading of 57.3 and the highest since June 2010. On a smoother three-month average reading, the future HPSI rose to 56.7.

Regional differences in the outlook for prices remain, although all regions except the North East anticipate that the value of their property will rise in 2013. 

Londoners (70.4) lead the way, with sentiment at its highest level since February 2010. They are followed by those in the South East (66.4) and Wales (57.1). This is the second consecutive month that households in Wales have expected property values to rise.

However, there is still a north-south divide in the extent of the price rises expected, with households in southern England on balance more optimistic about prices rises than those in the north.

Those with mortgages were more upbeat about the prospect for house prices than those who own their home outright with readings of 62.6 and 58.8 respectively.

There was also a large jump in expectations of house price rises among those aged between 55 and 64 years.  The reading for this group rose from 55.1 in February to 61.9 this month, the highest reading since June 2010. 

Similarly, those aged between 25 and 34 years are also more likely to expect house price rises over the next 12 months than at any time since June 2010.

Gráinne Gilmore, head of UK residential research at Knight Frank, said: "Optimism that house prices will rise in 2013, which we saw at the start of the year, has strengthened again this month, with households in all but one region upbeat about the outlook for house prices.

"New data out this month suggests that the wider economic picture is brightening as well. A key activity indicator for the UK’s dominant services sector rose at the fastest pace in five months in February, indicating that the economy could be on track for positive, albeit modest, growth in the first quarter of the year.

"There was disappointment in the mortgage market last week after weak initial data was released by the Bank of England on its Funding for Lending scheme (FLS). The FLS has, however, had some influence on the mortgage market as the security provided to banks by the availability of the funding has led to a fall in loan rates."

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