House prices have settled back into a steady upward growth cycle, according to the latest survey from Hometrack.
The property research firm’s October housing survey reports a 0.4% increase in house prices for the second month in a row, and is predicting the positive growth to continue into next year, with price rises expected to reach 4% by the end of 2004.
The highest rises in October occurred in the more affordable areas of the country, with the highest being recorded in Hereford and Worcester (+1.6%) and East Riding in Yorkshire (+1.4%). Only north west London (-0.5%), Buckinghamshire (-0.2%) and Northumberland (-0.1%) recorded price falls.
John Wrigglesworth, housing economist at Hometrack, said: “The housing market is heading for new heights. There is no doubt that the year is finishing with new house price highs. Expectations of rising interest rates are having very little adverse effect on housing demand – with transactions continuing to increase across the whole country. Provided interest rate rises are modest – less than 1% – the health of the housing market should remain robust.”
Hometrack highlighted a number of other indicators which should provide stability to the growth. It found the number of sales rose 7% over the month, up 5% on September, and the sale price as a percentage of the asking price rose for the fourth month in a row to 95.1%.
In addition, the number of buyers has risen in relation to the number of properties for sale, and the average time taken to sell has fallen from 5.3 weeks to 5.1 weeks.