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Property prices will rise by an average of 1.4% over the next year according to respondents to the BSA's Property Tracker survey, as cautious optimism returns to the housing market.
The survey found that respondents average prediction for house price changes over the next year was for a 1.4% rise(4). This represents a fundamental change when compared to a 6.1% fall in March and a 7.1% fall forecast in June 2008.
This positive message is reinforced by the survey finding that yet again, an increased proportion of people believe that now is a good time to buy. 59% of people agree or tend to agree that now is a good time to buy, compared to 54% in March and just 27% in June 2008.
However, this good news is tempered by findings that a lack of job security remains the greatest barrier to property purchase. It was chosen by 61% of respondents, the same proportion as in March. With many commentators expecting unemployment to continue to rise well into next year, and with perceived restrictions on mortgage availability, it is likely that this will serve to limit any recovery in the housing market.
Commenting on the survey's findings, Paul Broadhead, Head of Mortgage Policy at the BSA said:
There have been a number of encouraging signs that the worst of the property crash has passed recently and the Property Tracker shows that people think both that property prices will now rise and that now is a good time to buy. However, improving job security will be key to any substantial recovery of the housing market.
People clearly recognise that with both property prices and mortgage rates having fallen, there are potential bargains to be found meaning that now is a good time to buy.
However, for many, concerns over job security mean that they are unlikely to actually go ahead and buy. They will need to see confidence in the jobs market return before they make their move in the property market.
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The full survey can be found by clicking the link below.
CONTACT: Jayne Chichester
DIRECT LINE: 020 7520 5926
EMAIL: jayne.chichester@bsa.org.uk
The Building Societies Association (BSA) represents all 53 building societies in the United Kingdom. Building societies have total assets of £385 billion and, together with their subsidiaries, hold residential mortgages of almost £250 billion, more than 20% of the total outstanding in the UK. Societies hold over £240 billion of retail deposits, accounting for more than 20% of all such deposits in the UK. Building societies also account for about 37% of all cash ISA balances. Building societies employ over 51,500 full and part-time staff and operate through more than 2,000 branches.
Photographs of Paul Broadhead are available from the BSA press office, from the Associations website at www.bsa.org.uk ( http://www.bsa.org.uk/ )or Headlinemoney www.headlinemoney.co.uk ( http://www.headlinemoney.co.uk/ )
The full results of the property tracker survey are attached.
The average house price figure prediction is a median calculated by the BSA from Yougov data, excluding those that replied don't know and assuming responses are evenly distributed through each range of prices that could be chosen.
All figures, unless otherwise stated, are from YouGov plc. Total sample size was 2,242 adults. Fieldwork was undertaken between 4th-8th June 2009. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).
The next Property Tracker will be published on 16 September 2009.
