April was the tenth month during which house prices have fallen research reveals today.
The Hometrack April survey concurs with several other reports published last week which reveal a very modest drop in house prices - of just 0.1% for the month in the case of this survey - but which also suggest that such a small reduction in house prices indicates a market that is stabilising.
Hometrack says the average property now costs £162, 100 down from a peak of £167,700 in June 2004.
Despite a lacklustre market, Hometrack says activity has increased this month. Sales agreed have risen by 9.4%, in part due to ongoing increases in the number of buyers registered since the beginning of the year. But even though buyers have been returning to the market, the backlog of properties registered with estate agents means there is still a considerable oversupply, claims the survey.
It says the oversupply explains the increased number of buyers in the market, adding that they are still negotiating discounts of over 6% on asking prices. The month's average sales prices as a percentage of asking price has decreased slightly to 93.3% down from 93.4% in March, says Hometrack.
The report claims the amount of time taken to sell a property remains stable at 7.4 weeks during April but the average number of viewings per sale has decreased to 12.4, down from 13.2 in March, suggesting buyers are not holding back as they have been previously.
And 27 counties have seen prices remain alomst static during April compared to 31 counties which saw property prices fall. Those areas that saw property price increase of remain central London (0.6%), the West Midlands (0.6%) Dorset (0.5%) and Wiltshire (0.3%). The counties reporting the largest property price drops include Bedfordshire (0.7%), Gloucestershire (0.5%), Surrey (0.4%0 and Oxfordshire (0.4%).
John Wrigglesworth, housing economist for Hometrack says election jitters are not helping the housing market due to uncertainty over economic and political prospects. But he adds: ”There is no fundamental reason why the market should not recover, confidence is the key. We continue to predict 3% house price inflation for the year. The Conservative party’s announcement of their intention to scrap Stamp Duty below £250,000 is helpful but not significant. It will only take 1% off house prices, which in the context of rises of nearly 100% over the last five years is akin to taking a snowflake off an iceberg.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Matthew West on 020 7484 9893 or email [email protected].IFAonline
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