Is it a Good Time to Sell Your Home?

Posted on August 6th, 2014 by Andrew Twine

UK house prices are now at their highest point in seven years as they record a double digit rise compared to the same time last year according to the Halifax, the UK’s largest mortgage provider. 

Their Mortgages Director Stephen Noakes said: ”House prices in the three months to July were 3.6per cent higher than in the three months to April. Annually prices were 10.2 per cent higher in the three months to July than in the same three months last year.

House Prices Hit New High In The UK

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While supply remains low, housing demand continues to be supported by a continuing economic recovery, growth in employment, improving consumer confidence and low mortgage rates. However, earnings growth is still lagging behind consumer price inflation.”

Last month’s figure also shows a 1.4 per cent increase on the previous month, which is unusual for the summer time when house prices seasonally tend to stagnate or subside slightly.

Halifax, part of the HBOS plc group. report the average price of a home across the UK in July was £186,322, two and a half thousand pounds more than June, but still nearly 7 per cent lower than August 2007 when it was £199,612.

However, the UK housing market has still slowed down significantly compared to the previous three months where annual house prices broke through the 20 per cent barrier.

The Halifax’s recent Housing Market Confidence Tracker suggests that many property owners surveyed believe that this next year represents their best opportunity to sell. 

Fifty seven per cent of them, which is the largest figure since the survey was introduced over three years ago, showed concern that prices may start to subside because of less demand from new property buyers.

This reinforces privately owned property analytics Hometrack’s latest research. Their data revealed that new home purchasers fell considerably last month which has given many owners an dilemma. Should they look to sell their home now whilst things appear to be pretty good, or sit tight and stay where they are and wait to see how things pans out.

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Alan Clarke

Scotiabank economist Alan Clarke told Bloomberg that the country is getting to the point where the Bank of England think that an interest rate hike is justified.

Mr Clarke told the financial market news station that the Bank probably doesn’t need to really care about house price inflation.

He said: “We are seeing double digit house price increases on a national measure, but that is overly distorted by London going up by 20 per cent. Strip that out and the rest of the UK is only going up by 5 to 6 per cent.

The bank is probably not too worried about that and they’ve played that down which may calm some fears that a rate hike is any time imminent.”

He said that he expects divisions to escalate within the monetary policy committee as more may vote for a rate rise. He continued, “ I suspect we may start to see hints of that in the minutes of this meeting which will lay the foundation of a hike into the new year.”

The senior economist disagreed with recent opinions about the Help to Buy Scheme introduced by the chancellor George Osborne. He believes that it was and is still a really good tool to use. He added, “ The Help to Buy stimulated supply which kick started the economy and needs to continue.”

Howard Archer, chief UK and European economist of IHS Global sums it up by saying: “The Halifax data adds to the current uncertainty over the true state of the housing market. Furthermore, an appreciable rise in mortgage approvals reported by the Bank of England in June fuels uncertainty as to whether the recent loss of momentum in housing market activity is likely to be lasting or just a temporary development related to changing mortgage regulations.”

About the author

Andrew Twine Andrew Twine is a Finance Writer at Cash Sorted. He is mostly involved in the administrative side of the office and a valuable member of the team. Andrew loves painting, camping & spending time with his family.

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