Improving sentiment in the property market in the UK

The owners of residential property in the UK in all regions expect an increase in prices of value of their property over the next 12 months. Such optimism about rising prices reached the highest level in the last three years.

The most optimistic about price growth are set up Londoners, followed by district East Midlans. The most modest growth expectations in the North-East. These are the results of a newly published joint with Knight Frank and Markit’s House price Index of real Estate Prices – HPSI – House Price Sentiment Index.

In the result of the study it was found that 15% of the 1,500 surveyed homeowners in the UK said that the value of their home rose over the last month, and 8.6 % said that the price dropped. These data give the size of the index HPSI – 53,2 – the highest since June 2010. If the index is greater than 50 – consequently, prices are rising. If the index shows a figure less than 50 means prices are falling.

In June, the index for the third month in a row shows a positive trend after 33 months when he was around 50 or below. It is absolutely certain the signal of the UK property market, after three years of decline, the owners of houses and apartments believe that their estate will rise in price.

Londoners still ahead of all the UK’s level of optimism regarding the prices of houses and flats in London. The level of the index HPSI in London reached 73,1, although slightly lower to 76.3 in may. London comes on the heels of the East Midlans where HPSI is equal to 72.9 , which is significantly higher 55.8 points in may. This is the most significant jump in expectations since the beginning of the index.

In the region with the most modest expectations – at the level of 56.2 in the North – East , also demonstrated positive dynamics.

After three years of pretty grim sentiment in the housing market, the June data show that the market has turned. London traditionally holds the palm in terms of positive expectations, but also other regions showed a confidence that could signal the beginning of a recovery in economic activity in the UK.

It is also evident that the more optimistic data began to emerge after a multibillion-dollar infusion of the British government on the housing market and the establishment of record low mortgage rates. The sentiment index has started to show modest improvement in the early years, before the launch of government schemes of assistance to people wishing to buy their homes “Help to buy”. But after launch of the scheme “Help to buy” in the spring of this year, it has added momentum to the optimism of the real estate market of the United Kingdom.

In the context of regional trends, optimism is present in 70% of cities in the UK.

® Alice Morgan 21.06.2013