Improving conditions allow mortgage approvals

The government’s Funding for Lending and Help to Buy schemes have begun to have an impact on the housing market, as house price growth is finally gaining some momentum. In contrast to earlier predictions of a flat housing market in 2013, we now expect some improvement in activity and a muted rise in house prices through the rest of the year.

The house price index released on 28th June 2013, shows that UK prices rose by 0.3% in June, marking the ninth consecutive month of no decline. Additionally, on an annual basis, house prices were 1.9% higher in June compared to a year ago; suggesting that the UK housing market may finally be recovering from the crippling weakness that held it back in the last few years.

Recent surveys also suggest that these prices increases are largely demand-led. New buyer enquiries have risen to their strongest level since August 2009 and price expectations have also improved, with a majority of respondents anticipating a modest rise in prices in the next 12 months, rather than the stagnation expected previously.

To find out more, read our latest edition of our Monthly Digest, by clicking here.