According to propertyfinder.com’s latest home-owner survey confidence in the housing market slipped in November as home-buyers and sellers absorbed the news that base rates had risen to 5%, and that further increases may be on the way.
On average, respondents to the November survey expect house prices to rise 5.2% over the next 12 months.
Although 79% of respondents expect the market to continue to rise and only the minority expected price falls, three quarters feared further interest rate increases, while half feared mortgages will become unaffordable.
In England, regions to the South expect a far stronger market than regions to the North. Scotland and Wales are also more optimistic.
Warren Bright, chief executive of propertyfinder.com, says: “North of a line from Cheltenham to Chelmsford, there is a dramatic change in sentiment on the housing market. The strong performance of the City is driving the economy in the south, with rich bonus pickings supporting prices.
“Conversely elsewhere in England, more subdued expectations for house prices suggest housing affordability may actually improve when compared to wages.
“Fortunately, people have healthy levels of equity in their homes, giving them an important cushion when they move. On average, buyers want a mortgage worth 61% of the value of their new home meaning that they have over £80,000 of equity to invest.”