Housing market sentiment close to all-time low amid house price uncertainty

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, comments on the publication of the Building Societies Association’s Property Tracker, showing housing market sentiment close to all-time low amid house price uncertainty.

Key points from publication:
    • The Building Societies Association Property Tracker shows housing market sentiment remains close to the all-time low in September.
    • In December 47% of respondents said they did not agree now was a good time to buy a residential property in the UK.
    • This is down from down from 52% in September.
    • 14% agreed that it was a good time to buy, and 16% said ‘don’t know.’
    • Almost half (49%) of people thought house prices would fall over the next 12 months, and just 16% thought they would rise.
    • 70% were worried about rising energy prices. This as mentioned by 72% of those with household incomes of up to £50k and 62% of those earning more than £100k.
    • Affordability of monthly mortgage payments was the main barrier to property purchase, cited by 66% of people.
Helen Morrissey says:

“There’s little festive cheer to be found in the housing market right now with the BSA’s latest property tracker, finding sentiment close to all-time lows. After years of flying high, the market has taken a real bruising with rising living costs and the threat of recession putting a stop to peoples’ plans to buy that dream home, while the prospect of falling house prices mean many people are putting off getting their house on the market. 

“Added to this, the mortgage rate turmoil experienced in the aftermath of the mini-Budget scared many people off taking the plunge as they wait to see if rates will come down before they take a chance.

“After years of low rates, mortgage payment affordability is now the main barrier to property purchase – far more so than the traditional barrier of raising a deposit.

“The data shows the difficulties homeowners themselves are facing in meeting their day-to-day basic costs. Energy prices were a major worry for people regardless of salary level – it’s something affecting everyone while rising food prices are also of concern.

“This will no doubt have knock on effects in that if you are struggling to meet these costs, you are very unlikely to be able to save. With no sign of these pressures easing any time soon, and so very few people thinking now is the right time to buy, we are unlikely to see any real thaw in sentiment.”

 

Kindly shared by Hargreaves Lansdown

Main article photo courtesy of Pixabay