Housing demand dips

A sizeable dip in housing demand and faltering consumer confidence are highlighted in the latest monthly survey of house prices by analyst Hometrack.

Demand for housing dropped by 4.3 per cent in November, the fifth monthly fall in a row and the largest single monthly decline since January 2009.

Hometrack said the decline is largely seasonal but the scale of the fall has been exacerbated by weaker consumer sentiment fuelled by spending cuts and renewed concerns over the economy amid expectations that house prices are set to fall further.

Prices are set to remain under downward pressure in the near term but a tightening in supply means that by the end of 2011 prices are forecast to fall by two per cent.

Hometrack director of research Richard Donnell said: "Despite the decline in demand over recent months house prices have not fallen to the same degree as they did in 2008 and 2009.

"Overall prices were down 0.8 per cent in November following a 0.9 per cent decline in October. Today, unlike then, prices are falling off a lower base."

 

huw.morris@haymarket.com

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