The report highlighted that households in all UK regions expect house prices to rise over the next 12 months, led by those in the South East, with mortgage borrowers the most confident that prices will rise over the next year.
Some 21.3% of the 1,500 households surveyed across the UK said that the value of their home had risen over the last month, while 4.0% said that prices had fallen.
Gráinne Gilmore, Head of UK Residential Research at Knight Frank, said: “The UK’s housing market continues to be supported by low interest rates and good economic fundamentals, and pricing in some areas is underpinned by a shortage of stock. While the HPSI has ticked up in November, the overall trend is a gradual slowdown in the pace of growth, with the average reading this year at 58.4, compared to 61.0 last year.
Households across all tenures expect house prices to continue to rise over the next year, although homeowners expect stronger growth than those in the rented sector. The survey also highlights the regional variations in future house price expectations, with the future HPSI for households in the South East overtaking London by the largest margin in more than a year.”
Tim Moore, senior economist at Markit, said: “UK house price sentiment remains firmly in positive territory, with around five times as many households suggesting a rise in their property value as those that noted a decline during November.
At the same time, there was a rebound in households’ confidence about property values for the next 12 months, with this index close to its highest seen so far in 2015. Improving job market conditions and an expectation that interest rates will remain low for longer appear to have boosted households’ confidence regarding property values.
Housing market sentiment continued to vary widely across the UK regions, reflective of local demand conditions and supply dynamics. Most notably, latest data indicated that people in the South East are more likely to expect a rise in their house price over the year ahead than at any time since the survey began in 2009.”
Andy Sommerville, Director of Search Acumen, comments: “With London prices out of reach for many aspirational homebuyers, it appears areas in the commuter belt are gaining popularity, particularly the South East, with its rolling countryside and easy access to the capital. Wage growth is now outpacing inflation for the first time since 2010, according to the recent ONS figures[1] and the highest number of people are at work since records began[2], so we’re definitely seeing greater purchasing power, although it’s clearly still not enough to buy a property in London’s inflated property market.
It will be interesting to see if house prices in East Anglia, particularly Essex, begin to increase at the same pace in the near future, given these locations are set to benefit commuters immensely when the Crossrail project completes in 2018.”
