Optimism returning to housing market

Wednesday, 17, Jun 2009 11:13

Cautious optimism is returning to the UK housing market according to a survey out today.

The Building Society Association (BSA) found in its Property Tracker survey that Brits predict property prices will rise by an average of 1.4 per cent over the next year.

This compares with a 6.1 per cent fall predicted in March and a 7.1 per cent fall forecast in June 2008.

Encouragingly, the number of people who thought now was a good time to buy had also increased, to 59 per cent, adding fuel to the fire of 'green shoots' in the property market, which have been highlighted in a number of recent housing market surveys.

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."

Some 61 per cent of those surveyed chose 'job security' as their main concern about buying a property, with many expecting unemployment to rise.