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Home owners still expect property prices to rise

Tuesday, 24 May 2011 12:43 PM

Eight out of ten home owners think house prices will rise over the next five years and only one in ten expect a fall.

However, a survey by estate agent Your Move also reveals that owners expect prices to rise by just 6.9 per cent over that time, much less than the 10.6 per cent they predicted a year ago.

Owners were also more pessimistic about house price movements over the next 12 months. Just 37 per cent expect an increase, compared to 75 per cent this time last year. The average owner now expects a fall of 0.6 per cent.

Some 60 per cent think that prices will recover in the next two years but the size of the increase has fallen to 1.8 per cent, compared to 5.4 per cent a year ago.

However, the survey also showed that owners may be underestimating how much the price of their home has increased in the past.

Gareth Samples, managing director of Your Move, said: "Slowing house price growth has clearly taken its toll on homeowners’ confidence and, alongside the clear risks to the UK’s long-term economic health, this has made prices fall.

“The strongest downward force on property prices is how hard it is to get a mortgage and while it may be some time before lenders loosen their purse-strings, homeowners know that once finance becomes more readily available, prices will recover."

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