There are glimmers of hope in the latest house price statistics, the National Association of Estate Agents has reported.
Although house prices ‘plummeted’ across the country the percentage of first time buyers increased – for the third month in a row.
NEAE estimates that between October to November, the average price of a flat fell from £118,334 to £114,288 while a terraced house dropped from £151,305 to £149,589. The average semidetached property fell from £199,905 in October to £192,042, while the average detached property price dropped from £291,592 to £287,922.
The number of sales per agent also fell from seven in October to six in November, ‘but remains higher than the low point of five in August’.
‘November, and indeed December, is always a quiet time for the housing market because people are reluctant to move home over the festive period’, said NAEA president Chris Brown.
’Bearing that in mind, and after what has been the most difficult year for the market in a very long time, these figures are definitely not as bad as expected. In fact, while it may seem a meagre offering, the glimmer of positive news that some of these figures reveal can give estate agents across the country some hope for a more prosperous 2009.
’The market is still waiting to feel the impact of recent interest rate cuts, and if the major lenders commit to making mortgages available to those who want to buy then the market should improve next year’.
• Although the Council of Mortgage Lenders, Halifax and Nationwide have decided against publishing house price forecasts for 2009, Hometrack has ventured an opinion that prices will fall a further 10 per cent in 2009 and 3 per cent in 2010 - on top of falls of 9 percent in 2008.
The property research company also said it expected repossessions to reach a near record high of 70,000 next year - up from 45,000 in 2008.
Meanwhile Propertyfinder.com is predicting further house price falls in the range of 6 per cent to 20 per cent. But rental incomes should rise by up to 3 per cent.
‘The outlook for 2009 is more positive than 2008’, said the firm. ‘We do expect prices to continue to fall, by around 12 per cent, although exact price falls will depend on the extent to which the mortgage markets improve. Most importantly, we think the worst is already over in terms of transactions.
‘The UK’s housing shortage is currently at the back of everyone’s minds, but the effects of current limited building will be felt severely. Sensible buyers should be hunting for bargains in 2009 while the market provides good value.
‘The rental market in 2009 will continue to see high tenant demand, although it will be slightly diminished by the fact that first time buyers will start to buy again. The end of 2008 saw rents falling as desperate sellers became ‘accidental landlords’ and this trend will continue at the start of the year.
But landlords who have not had the power to choose an appropriate property will find it difficult to cover costs and, once buyers return to the market, many of these accidental landlords will put their homes up for sale again and supply will contract.
All-in-all, rents will fall modestly in the first quarter of 2009, recovering to 0 - 3 per cent growth by the end of the year.
