The Market Turns

Monday, June 28 2004

The Hometrack June survey of the national housing market has reported a 0.4% increase in average national house prices, down from 0.6% last month, and this is not the only indicator that things are beginning to change.

According to the property research company, new buyers also dropped in June by 0.6%, reversing a previous rising trend. Hometrack’s National Demand Index has also recorded falls in excess demand for the first time since Christmas.

The June findings also discovered that average sales price achieved as a percentage of asking price fell to 96.2%, from 96.4% in May as another indicator that the market is cooling.

The average time to sell a house has also risen, to 4.2 weeks from 4 weeks in May’s survey, which is the first increase recorded this year.

However, these figures notwithstanding, house prices have continued to rise all over the country, apart from Oxfordshire, which saw a fall in prices of 0.7%.

John Wriglesworth, Hometrack’s Housing Economist said: ‘While house prices are continuing to rise, there are the first signs that the market may be easing. But speculation of a pending housing crash has no foundations. Interest rates still remain historically low, unemployment remains at a record low and incomes are rising strongly.

‘All the signs suggest that we are heading for a soft landing after the heavy price rises of recent years.’