House price growth might be slow but confidence amongst homeowners remains strong, particularly in the North of England and Scotland, a study has revealed.
Research by Zoopla found eight in 10 homeowners expected house prices to increase in their area over the next six months.
This is despite Zoopla’s latest UK Cities House Price Index showing house price growth slowing annually to 1.7% across the country’s 20 major cities in April, and 2.2% across the UK as a whole.
And while those in London are the least confidence of house price growth, more than 67% think the value of their properties will go up rather than down over the next half year.
Consumer sentiment is crucial
According to Zoopla, people’s feelings about the way the market is going is vital in terms of predicting future house price movement.
Laura Howard, a spokesperson for Zoopla, explained: “Whether or not these forecasts prevail, consumer sentiment plays a crucial role in the health of the housing market.
“A feeling of stability means buyers are more likely to start actively looking for their next home, confident that now is the right time to make a purchase. And, in turn, an active pool of buyers will encourage sellers to list their homes for sale.”
Regional differences
Homeowners in Yorkshire and Humber and the North West of England are the most optimistic about their local property market, according to Zoopla.
Indeed, 91% of respondents in both these areas said they thought house prices would increase over the next six months. In Scotland, 90% of homeowners predict a rise.
Meanwhile, London is the place where the fewest people think prices will rise. Just behind it, homeowners in the South East are the least positive, with only 74% expecting house prices increases.
The North East is the third least confident region, with 78% expecting rises here.
Howard said: “Despite evidence of a slowing housing market and ongoing political uncertainty, homeowners remain optimistic about the future of property prices.”
She added it was no surprise London homeowners were the least confident about prices, since they had fallen by an average of 0.5% in the capital compared to 12 months ago.
Yet, despite this, more than two thirds of London homeowners expected to see rises in the next six months at a considerable rate of 4.5%.
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