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HPSI: House expectations fall


House price expectations in the United Kingdom (UK) have hit an 18 month high, according to a new House Price Sentiment Index (HSPI), released by both Knight Frank and Markit Economics.

It's certainly interesting news for those involved in the residential property investment space.

The HSPI results

The new report was quite comprehensive, and surveyed 1,500 households from areas across the UK. Interestingly, 19 per cent reported that the value of their home had risen in the past month, while 6 per cent reported the opposite.

Of course, the results aren't entirely positive. While the majority of those surveyed believed their property had risen in value over the course of the last month, the overall reading remains moderate. The HSPI reported that the index for February of this year was the lowest since August 2013.

Looking ahead

The HSPI survey also took a look at the future of property, specifically what was likely to happen this year. According to the results, many in the UK would seem to expect house prices to fall again - meaning the third month of falling expectations.

"The moderation in sentiment comes despite the prospect of a prolonged period of ultra-low rate inflation and low unemployment," explained Grainne Gilmore, the Head of UK residential research at Knight Frank.

"However new mortgage rules and affordability constraints in some parts of the country are likely to weigh on price growth. In the shorter-term, many households are focussing on the election, the outcome of which could change some household finances if taxes or benefits are reformed."

It's likely going to be an interesting year for the UK property market, especially with 6.2 per cent of UK households announcing their intention to purchase a property sometime within the next 12 months.

Now is the perfect time to consider the feasibility of new property in the UK.

Date Published: 27 Feb 2015
Category: General NewsNews

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