Housing market confidence hits two and a half year high

Four out of five (81%) UK homeowners think that property prices will continue to climb over the next six months, according to the latest Housing Market Sentiment Survey from leading property website, Zoopla.co.uk. Optimism around the housing market outlook is significantly improved from one year ago, when less than one third of homeowners (30%) expected house prices to rise.

According to the survey, only 9% of homeowners believe that property values will fall over the next six months whilst a further 10% expect prices to remain flat. The average growth predicted by those surveyed is for house prices to rise by 5.7% by October.

The current level of optimism bodes well for market activity, with transaction volumes expected to rise significantly over the coming months given the historically high correlation between the confidence level in the Zoopla.co.uk Survey and market activity approximately three months later.

However, the availability of mortgage financing remains the main obstacle to a sustained improvement in the housing market with four out of five (78%) of those surveyed saying that it is now no easier to obtain a mortgage than it was three months ago. And the upcoming election is also a clear factor in terms of current market activity with almost a quarter (23%) of those surveyed stating that they will wait to assess the outcome of the election before making any property-related decisions.

Nicholas Leeming, Commercial Director of Zoopla.co.uk, said: "With the bad weather behind us and the recent stamp duty relief introduced for first-time buyers, confidence in the property market has bounced back well. Despite the optimism, significant concerns remain around the supply of mortgages and whilst affordability levels are now higher than at any time in the past few years the lack of mortgage funding, especially for first-time buyers, remains the single biggest threat to a full housing market recovery."

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