As previously reported on this blog, Nationwide recently released the results of a survey that clearly indicated we could expect a 10% to 15% rise in property prices in the UK in 2010. Quick as an eye blink, Halifax has taken the wind out of the sails of that good news by releasing their own survey that seems to say almost the opposite.
According to them, the growth we saw in January was around 0.6% down from a six monthly average of 1.1%. This leads them to get fairly gloomy and suggest that perhaps the increase in properties coming to the market will see pressure on prices stifling any rises.
It is true that houses are being bought to market fairly quickly as home owners are galvanized by what looks like a little light at the end of the tunnel. People have been stagnant for a long time now and many of them are desperate to take advantage of any improvement in property prices to sell up and move on.
The closure of the Bank of England’s quantitive easing program is likely to mean that UK base rate stays low for a further fairly prolonged period. The bottom line, however, is that if more properties become available but mortgage lending does not increase then we are likely to see a downward pressure on prices.