The Inside Edge
It’s that time of the month again where sets of figures and conflicting views are released in regards to the housing market and the Halifax have greeted their monthly statistics with the claim that prices are ‘fluctuating widely’. Meanwhile, the Royal Institution of Chartered Surveyors (Rics)state that the market is back in the ‘doldrums’ after a brief flurry of activity at the start of the year.
Halifax confirmed that average prices fell sharply in April as the stamp duty concession ended on the 24th of March. Overall, that drop equated to 2.4% in real terms with the average price of a house across the UK now being recorded at £159,833 – 0.5% less than for the same period last year.
However, the lender still claims that the underlying trend is one of upwards movement.
“Prices in the three months to April were 0.3% higher than in the previous quarter, marking the first rise in this measure for seven months,” said Martin Ellis, Chief Economist of the Halifax.
Howard Archer of IHS Global Insight suggested that the figures pointed to a rather more gloomy trend.
“Housing market activity is very low compared to long-term norms,” he said.
“And the economic fundamentals currently look worrying overall for the housing market with unemployment high and likely to rise further, earnings growth muted, and the outlook uncertain.”
Meanwhile, the Rics carried out its monthly survey of members and also found a sharp fall in sales, across the UK, except in London. The closure of the stamp duty holiday was always expected to have a damaging effect on the market and the institution claim that this is now being shown.
“With the recent surge in activity brought on by the stamp duty holiday coming to an end, it is unsurprising to see that prices across much of the country are continuing to fall,” said Peter Bolton King, the housing spokesman for Rics.
“Renewed concerns over the economy and talk of a double-dip recession dominating the headlines in recent weeks may well have served to undermine consumer confidence.”
Mr Bolton King went on to add that the lack of affordable mortgages was also having an effect on sales.
“What’s more, the continuing lack of affordable mortgage finance is still hindering many first-time buyers who cannot afford to get a foot on the property ladder,” he added.
For once, the Halifax and the Nationwide seem to agree that property prices are falling and only now are we beginning to see the effect of the end of the Stamp Duty holiday.