Hometrack: chronic lack of supply driving price growth

Published on

house-price-graph

House prices rose by 0.5% in October, driven by a widening gap between supply and demand and above average growth in prices in London and the South East, Hometrack has reported.

The supply of homes for sale fell by 1.6% in the month following a 0.3% decline in September. Growth in new sales being agreed is running at 4-5% per month and Hometrack is continually eroding the stock of homes for sale. In contrast, levels of demand have grown by 3% in the last two months. Improving confidence amongst buyers has been fuelled by low mortgage rates and positive news on a recovering housing market.

Richard Donnell, director of research at Hometrack, said: “The strongest increase in demand over October was seen in London (+6.4%) and this is maintaining the pressure on prices which grew by 0.8% over the month, the same as September and down slightly on August (0.9%). Price rises have been accelerating across the South East where they increased by 0.7%, up from 0.6% in September. Across all other regions prices grew at a below average rate, with the exception of the North where prices remain static.

“The net result of the growing scarcity has been achieved prices getting closer to asking prices – the proportion of the asking price being achieved has jumped to 95.2%, close to its all-time high of 95.7% (June 2007). The proportion has grown across all regions in recent months as buyers have been willing to pay a larger proportion of the asking price to secure a sale.”

Latest POLL

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

Advice Guru partners with Pure Retirement to support broker education

Financial adviser learning platform Advice Guru has announced a new sponsorship partnership with Pure...

Nationwide ups LTV limits for interest-only and foreign national borrowers

Nationwide has announced changes to its mortgage lending criteria, increasing the maximum loan-to-value (LTV)...

Lloyds expects swell in completions ahead of stamp duty deadline

Lloyds Banking Group anticipates a 50% growth in property completions this month as buyers...

Satchell the latest to leave HTB bridging division

Lorenzo Satchell has become the latest senior member of the bridging team at Hampshire...

Other news

Advice Guru partners with Pure Retirement to support broker education

Financial adviser learning platform Advice Guru has announced a new sponsorship partnership with Pure...

Nationwide ups LTV limits for interest-only and foreign national borrowers

Nationwide has announced changes to its mortgage lending criteria, increasing the maximum loan-to-value (LTV)...

Lloyds expects swell in completions ahead of stamp duty deadline

Lloyds Banking Group anticipates a 50% growth in property completions this month as buyers...