Homeowners expect property prices to rise

Most homeowners expect their properties to rise in value over the next year, according to new research.

16:21 11 June 2005

Most homeowners expect their properties to rise in value over the next year, according to new research.

Around 54 per cent of property owners questioned by the Yorkshire Bank think their homes will increase in value, suggesting rising confidence in the housing market.

Homeowners in Wales were most optimistic about the future of their assets, with 63 per cent thinking house prices will rise, reports the BBC.

Those living in north-west England were the next most optimistic homeowners on 58 per cent, while 57 per cent of property owners in London expected prices to rise.

Residents in the East Midlands and East Anglia were the least optimistic about the housing market, with less than half of those interviewed predicting that house prices will increase.

Despite Wales being the only area of the country where homeowners are more confident of price rises than they were a year ago, the Yorkshire Bank claims the survey illustrates a growing confidence in the market because greater numbers of sellers are prepared to hold out for the asking price on their property.

The bank says one in four sellers nationwide are now confident enough to reject offers below their full asking price.

Researchers say the Bank of England's decision to keep interest rates on hold at 4.75 percent over the last ten months has helped to boost confidence in the housing market.

"The longer interest rates remain static, the more likely it is confidence will continue to build and the market remain healthy," said Gary Lumby, head of retail at Yorkshire Bank.

Although the number of house sales is currently 30 per cent lower than a year ago, the bank says the number of new mortgages being approved has risen in each of the last three months, indicating an upturn in the market.