Confidence in the UK housing market has fallen to its lowest level in three years but prices are still expected to rise, new figures show.
The latest Halifax Housing Market Confidence Tracker – which tracks consumer sentiment on whether house prices will be higher or lower in a year’s time – shows a decline of 14 points from March 2016 (+56) to a net +42 – the largest recorded drop since the survey began in 2011.
Despite this, a clear majority (57%) still expect the average UK price to be higher in a year’s time, more than three times the proportion who expect a lower average (15%).
The outcome of the EU Referendum has had little impact on buying and selling intentions, with only 15% of those thinking of buying or selling a property before the vote saying they have since delayed or cancelled their plans as a result of it.
As the Bank of England voted to keep its base rate on hold in November, over half (53%) of mortgage holders expect mortgage interest rates to be the same a year from now
The proportion of those expecting rates to be higher in a year’s time is 38%, compared to 52% in June 2015.
Martin Ellis, Halifax housing economist, said: “Optimism in the housing market has taken a fall in recent months, with many people now expecting a general slowdown in the market and no, or little, change in house prices over the coming year. This sentiment is consistent with recent findings from the Halifax House Price Index which show that prices are still growing, but to a lesser extent.
“Confidence with the wider economy has tracked down sharply since May 2015 but encouragingly, optimism has bounced back to where it was a year ago and is broadly neutral.”
