House Buyer Confidence Falling
New figures from Hometrack show that house buyer confidence is falling, reflected in the proportion of asking prices being achieved in house sale.Th proportion of sales achieving the asking price has fallen to 94.9%, where historically a proportion of 94% signals small monthly price falls to come.
Richard Donnell, Hometrack's Director of Research, said: "Buyer confidence has been weakening on the back of increased affordability pressures over recent months, but the turmoil in the global equity markets has added a new external dimension. If this continues it is likely to further undermine market sentiment which will drive weaker levels of demand into the autumn and further undermine the rate of house price growth.
Despite weaker market sentiment, demand for housing still exists but buyers have become far more price sensitive. The net result will be a continued slowdown in the headline rate of growth with asking prices coming under the greatest pressure in the months ahead.History shows that the further the measure moves towards 94 per cent and below, then the greater the likelihood of small month-on-month falls in underlying house prices.
For example, the regions with the lowest year-on-year rates of house price growth - the North (0.7 per cent) and Wales (one per cent) - have the lowest proportion of asking price being achieved - 94.3 per cent and 93.8 per cent respectively."
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