The latest release of the LSL Acadametrics House Price Index has shown that February’s monthly house prices have increased by 0.3 per cent but the gains of early 2010 dropping out of the figures means that annual prices have fallen by 0.5 per cent.
The level of transactions in February look likely to be in the region of 41,200 but it is still the second quietest February since computerised records began in 1995.
Richard Sexton, business development director at e.surv said:
"After falls throughout the final quarter of 2010, prices have been bolstered by strong demand in London and the South-East. The best performance has been in the market for prime property in London and the south-east, but there are also encouraging signs from the mortgage industry which could bring about a more widespread and sizeable recovery. The proportion of mortgage products requiring more than a 25% deposit is at a 2-year low and many of these new products are for high LTVs. Nevertheless, product numbers alone can be misleading. Lending is still constraining demand as mortgage lenders are concerned about the possibility of rising unemployment as the public spending cuts continue. These concerns are particularly focused on areas with high levels of public sector employment, such as northern England and Wales.”
David Brown, commercial director of LSL Property Services, commented on the latest LSL/ Acadametrics House price index:
“Despite the uncertain economic outlook, there does seem to be a newfound sense of optimism returning to the housing market. Mortgage lending is still well down on historic levels, although there have been signs that more products, with higher LTVs, are entering the market. This has alleviated some of the built-up demand from some frustrated buyers. Nevertheless, for the average first-time buyer, finding mortgage remains a real hurdle. This is placing the private rental sector under increasing stress as it accommodates a growing population of would-be buyers — and we should expect rents to continue to grow this year as competition heats up for each rental home.”
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