The latest figures show that average house prices were 7.2% higher in June than at the same time in 2009. Assetz compiles monthly average figures taken from five of the major house price indices to offer a more accurate picture of house price trends.
The annualised average rates of growth continue to show increasing market stability with the six month rolling average now showing 6.6%, down from a peak of 11.96% in October 2009.
Chief Executive of Assetz, Stuart Law, said:
“The latest figures from Assetz House Price Watch show that we remain in the midst of a consistent housing recovery. As predicted, however, annual UK house price growth continues to slow to a more sustainable level. Similarly, the latest CML gross lending mortgage figures continue to point to an increase in consumer confidence, with more buyers encouraged to return to the market amid improving conditions.
“The Government’s austerity measures and the rumoured second banking crisis could still dampen house price growth next year. However, the fundamental lack of supply in the market, as a result of a lack of government funding for housing associations and planning restrictions, will continue to drive up prices modestly this side of Christmas and beyond.
‘Mortgage rates are also likely to be kept low for the foreseeable future. I would not be surprised if the base rate is still at 0.5% at the end of next year, although there is a 25% chance it will have increased to 2% in this period. This is great news for homeowners on lifetime tracker mortgages and is likely to encourage even more buyers into the market.
“Current house prices are like a coiled spring, and with the impossible-to-solve housing supply problem I predict another boom period at some point later in the next ten years. For the year in hand, I still expect to see a modest 5% overall growth as the positives continue to outweigh the negatives. 2009 was also an uncertain year but our 5% prediction turned out to be the most accurate in the market at a time when most predicted prices collapsing. We may well see the same again this year.”
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