The UK housing market is still one that appears to be stuck in the mud after recent House prices figures were revealed by Nationwide. A glimmer of hope comes from Bank of England figures indicating that mortgage lenders approved 45,723 home loans, compared with a 22-month low of 42,719 in December.
House prices increased by 0.3% month-on-month in February, leaving prices 0.1% lower than the same month a year ago. The overall picture is still one of a market treading water. Indeed, the three month on three month measure of house prices, a better measure of the underlying trend, was basically flat in February at -0.1%.
Robert Gardner, Nationwide's Chief Economist, said "This shouldn't come as too much of a surprise. Housing market trends are closely linked to wider economic prospects. Given that the recovery hit a soft patch at the turn of the year and looks set to remain sluggish in the year ahead, the property market is likely to follow suit, with relatively low transaction levels and prices moving sideways or modestly lower through 2011.
It appears that demand for homes may have levelled out, supported by historically low interest rates and some stabilisation in the labour market. The continued uncertain outlook for the economy is likely to keep many potential buyers on the sidelines for some time yet.
Howard Archer, chief UK and European economist at IHS Global Insight, said: “A modest rise in mortgage approvals in January reported by the Bank of England and a small pick-up in house prices in February reported by the Nationwide represents some rare recent better data on the housing market.
source: www.thelittlehousecompany.co.uk
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