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Hometrack housing survey indicates start of a slowdown in house price growth.
LONDON, 30 MAY 2014: Hometrack - the residential property analyst - has identified a slowdown in the escalating growth of house prices across in May, in its monthly national housing survey.
Commenting on the results of Hometrack’s May National Housing Survey, Richard Donnell Director of Research at Hometrack said:
“House price inflation is starting to moderate both in London and nationally. The proportion of postcode districts with price increases slipped from 50% to 42% of market in May. This led to a slowdown in overall house price growth, with prices increasing by 0.5% in May, compared to 0.6% growth in both April and March. Signs of this slowdown in momentum were present in Hometrack’s monthly national housing survey in April, where we identified early signs of growing price resistance on the part of buyers in London.
Strong price increases, widespread talk of a possible housing bubble and recent warnings from the Bank of England on house price inflation are starting to test the resolve of buyers. London has led the recovery but the impetus for growth is emanating out of the lower value parts of the London market. In Central London house price growth has slowed significantly in the last year and was just 0.2% in May.
As the recovery spreads from London across the country house price inflation will be driven by mortgage reliant demand which is a key area of concern for the Bank of England. The implementation of the Mortgage Market Review (MMR) looks to be perfectly timed as stronger affordability checks will limit the ability of households to get ‘carried away’ by talk of housing recovery. There are already signs of slower activity in the mortgage market and we expect to see further signs of slowing house price momentum in the months ahead. ”
Download the PDF to view full results of the May survey.
Hometrack’s national monthly housing market survey is based on a monthly survey of estate agents and surveyors across all postcode districts across England and Wales.
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