Home prices are on the way back past pre-crisis peak, says forecast
Quarterly Housing Prospects report predicts that average home price will climb to
£219,000 this year
Personal Finance Editor
Monday 21 January 2013
House prices will reach and surpass their pre-crisis peak next year. The claim is published in a report today by economic forecaster CEBR which says a typical house price will top £223,000 in 2014.
The quarterly Housing Prospects report also predicts that the average home price – based on figures published by the Office of National Statistics - will climb to £219,000 this year, 0.8 per cent higher than in 2012.
Looking five years ahead, a typical UK home will cost £261,000 by 2018, the report says, some 19.1 per cent higher than this year.
Daniel Solomon, CEBR economist, said: “UK property prices will be driven to pass their pre-crisis peak for the first time by fundamentals such as a return to modest economic growth and restricted housing supply increases.”
He added that policy tools, such as further quantitative easing and the Funding for Lending Scheme, could also support house prices.
Mr Solomon expects the Bank of England to expand its quantitative easing programme from £375bn today to £450bn by late 2013 which has the potential to increase mortgage lending and raise property prices.
He said there are also preliminary signs that the Funding for Lending Scheme - which encourages banks to lend to the real economy - could support mortgage approval values and make mortgages more affordable. That, in turn, could raise property prices.
Backing up CEBR’s claims have been a number of optimistic housing market reports. Last Friday, the Knight Frank/Markit House Price Sentiment Index showed that households in eight of the 11 UK regions expect that the value of their home will rise in 2013.
The optimism has emerged because of positive sentiment about the official mortgage scheme, according to Tim Moore, senior economist at Markit. “Households are increasingly conscious that the Bank of England’s Funding for Lending Scheme has the potential to boost the UK property market in 2013,” he said.
The Rightmove house price index published today shows that new seller numbers have climbed 22 per cent year-on-year and the property website reports that there was a 27 per cent increase in traffic in the first two weeks of January.
Mike Shipside, housing market analyst at Rightmove said: “There is an increasing body of evidence suggesting genuine ‘green shoots’ of recovery after a prolonged period of the housing market bumping along the bottom.”
Rightmove’s latest research into those intending to put a property on the market in the next 12 months shows that seven in ten potential sellers are motivated by discretionary factors rather than forced sale drivers such as the “three Ds” of death, debt and divorce.
Mr Shipside revealed: “This month’s average asking price of £229,429 is only 0.4 per cent below the highest January figure ever recorded, which was £230,428 in January 2008.
“The slow recovery in prices over the past four years will be welcome news to many of those who bought at the peak and whose equity was undermined. This will help those with the requisite deposit to think about trading up or moving on, especially in better-performing southern regions.”
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A deceptively spacious, beautifully presented Georgian home with 3000sq ft of living space and five reception rooms
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
A three-bedroom, 15th-century cottage with original features in the picturesque village of Sissinghurst
A six-bedroom terraced house with large south-facing roof terrace, cinema room and wine cellar
A new seven-bedroom home built in Queen Anne-style with swimming pool and parkland views in Mortimer
A listed, four-bedroom farmhouse in the rural hamlet of Rushall with detached barn, four acres of gardens and paddocks
A first-floor flat with two bedrooms, a spacious reception room and communal grounds in a leafy part of London
A three-bedroom flat with a spacious rootop terrace and balcony, accessed from a private gated courtyard
A Grade II-listed pile with six bedrooms, stables and 39 acres of grounds in Standlake
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
World cities ranked in terms of safety, food security and 'liveability'
Life & Style blogs
9 reasons Greece's experiment with the radical left is doomed to failure
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
Have we reached 'peak food'? Shortages loom as global production rates slow
Greece elections: Syriza and EU on collision course after election win for left-wing party
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Liberal Democrat minister defends comments suggesting immigration causes pub closures
- 2 The awkward moment Sarah Palin raised $25,000 for Hillary Clinton's election campaign
- 3 Ball pool for adults opens in London
- 4 Amal Clooney gives excellent response to fashion question at European Court of Human Rights
- 5 Baldness could soon be treated using stem cells, scientists hope
£19000 - £21000 per annum: Recruitment Genius: Are you a friendly, confident i...
Negotiable: Tradewind Recruitment: At Tradewind Recruitment we are currently l...
Negotiable: Tradewind Recruitment: Tradewind Recruitment is currently working ...
£28000 - £34000 per annum: Recruitment Genius: This is an exciting opportunity...