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London bucks the trend of further drop in house prices

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.

As was the case in March, lower property values were signalled in ten of the 11 regions in April, according to the survey of 1,500 households. Sentiment was weakest in the North East (39.1) and Wales (39.2), which both recorded accelerated price falls. London continued to buck the trend, with those living in the capital reporting that the value of their home had risen for the second month running, albeit at a slower pace than in March (53.6, down from 55.1).

Positive expectations for house prices were recorded in nine of the 11 regions in April, up from just six in March. Respondents in London remain by far the most upbeat (62.2), followed by those in the South East (56.4) and East Midlands (55.7). Only in the North East (45.1) and Wales (48.0) are house prices expected to decline.

Sentiment regarding future house prices is broadly similar in the private (54.3) and public (55.0) sectors, with the latter recording marginally stronger optimism (the first time this has been the case in two years).

Respondents working in the Media/Culture/ Entertainment sector forecast the sharpest rise in the value of their home (68.5). Expectations are also strong in the IT/Telecoms category (59.2). The weakest sentiment is in the Retail sector (50.1), where survey participants expect house prices to broadly stagnate, although this represents an improvement on the previous six months where price falls were predicted.

Increased house prices over the coming year are forecast by homeowners and renters alike (in addition to those living rent-free at home). Mortgage-holders anticipate the strongest rise (55.3), followed by those renting privately.

Gráinne Gilmore, head of UK residential research at Knight Frank, said: “There is little surprise that outside London, the current view of households regarding the movement of their house price movements remains negative – economic news continues to deliver at best a mixed picture of the fortunes for the economy.

“The more interesting issue is the continuing view that house prices are likely to rise over the next 12 months.

“This confidence about future market movements is a welcome sign for the market – especially the breadth of confidence across the UK, with all but two regions expecting to see price growth in the near future.”

Chris Williamson, chief economist at Markit, said "It’s very encouraging to see the recent improvement in sentiment about house prices holding up in April. Views on both current and future prices have fallen back only very slightly from the improvement in March, which saw the most upbeat assessment since mid-2010.

"A healthy housing market is a key ingredient of economic recovery, not only because falling prices reduce homeowners’ wealth, lead to negative equity and hit consumer spending, but also because new home sales often stimulate spending on home improvements.

"It is once again London where perceptions about the current and future course of house prices is the most buoyant. However, a narrowing of the north-south divide was apparent: with the exception of Scotland, the northern regions and the midlands saw sentiment about house prices in the coming year improve whereas all southern regions, the east of England and Wales all saw a deterioration."

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