NAEA: No need to panic in UK property market

Monday, 14 April 2008 7:20 AM

Despite recent house price surveys suggesting the UK market is undergoing a severe moderation, the National Association of Estate Agents (NAEA) has urged buyers to remain upbeat.

Specifically, the NAEA is pressing homeowners in Wales and the West Midlands not to panic despite falls in average prices reported by the Halifax.

Released last week, the Halifax house price index shows prices in Wales were down 4.7 per cent over the last quarter, while the West Midlands saw prices drop five per cent over the same period.

However, these changes should be taken in context, argues the NAEA.

"We are already aware from our own members house prices are being affected differently throughout the country so to find such regional discrepancies comes as no surprise," said Peter Bolton King, chief executive of the NAEA.

"However, we do need to keep this in perspective; the report also states although prices have fallen by five per cent in the West Midlands they have also increased by 150 per cent in the last ten years.

"Likewise, in Wales a drop of 4.7 per cent was seen, again, against a backdrop of rises of 188 per cent in the last ten years."

Changes in other areas of the UK suggest the market is in a volatile state, and thus monthly changes must be carefully considered.

"In months gone by, the East and West Midlands have shown fairly similar results," continued Mr Bolton King.

"However, this time, contrary to the West Midlands fall, the East rose by 2.2 per cent. This highlights the current anomalies and the fact that you cannot look at one survey result in isolation."

In the wider perspective the market remains strong, and there is no need for panic, argues the NAEA.

"These figures are also set against the credit crunch, which has undoubtedly affected confidence in the market. However, the key factors that underpin the housing market still exist - low unemployment and a pent-up demand for houses," said Mr Bolton King.

"We can see from the figures in other regions that it is not all doom and gloom out there and in many regions the market is broadly stable. We need to tread very, very carefully before making judgements on the market at this current, unsettled, time."

The Halifax research shows prices have also increased in the north, East Anglia, Greater London and Scotland over the last quarter.

Tags:
• uk property news