Outlook still promising for housing market

Two new market assessments have said that the outlook for the housing market remains strong despite recent interest rate rises and a potential reduction in price growth.

The Assetz House Price Watch, which draws together the major UK price indices, reported that annual price growth rose from 10.7 per cent in May to 11 per cent in June, with the average price of a home reaching £210,768.

And while the market is set to see a slight reduction in growth over the course of the next few months, strong fundamentals suggest that the sector will remain buoyant moving forward.

"While we expect the rate of property price growth to reduce over the coming months, it looks set to remain buoyant at around eight per cent, and in spite of Brown's pledge, the lack of housing supply in the UK's prime locations means that the health of the market over the next five years or so seems secure, especially with the likelihood of increasing rental income," commented Assetz managing director Stuart Law.

The National Association of Estate Agents (NAEA) has reported similarly encouraging statistics, advising that while the number of buyers fell during June, there remained enough interest in the market in terms of both supply and demand to ensure that the sector would remain stable for the foreseeable future.


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