Zoopla survey reveals housing market optimism

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by Kay Murchie

A survey by online property website Zoopla.co.uk has found that more than three-quarters (79%) of homeowners believe home values will rise in the next six months, while only 11% are expecting house prices to fall over the same period.

In its quarterly survey of housing market sentiment, Zoopla found that overall, the 6,682 homeowners surveyed predicted average house values in their area will increase 5.4% over the period.

Those in Scotland are the most confident about house prices while those in Northern Ireland are the least confident. 83% of Scots expect their property to rise in value, compared to just 31% of those in Northern Ireland.

However, the survey found that those renting did not share homeowners’ optimism. According to Zoopla, almost half of renters (42%) believe house values in their area will either remain unchanged or fall in the next six months.

Furthermore, 76% of renters said it is no easier to obtain a mortgage now than it was last quarter.

However, in spite of the problems within the mortgage market, 53% of renters intend to try to purchase a property in the coming six months.

Commenting on the findings, Alex Chesterman, founder and CEO of Zoopla.co.uk, said: “Optimism in the property market is climbing back to levels not seen since before the credit crunch began in 2007 and is four times higher than it was in the depths of the decline earlier this year.”

“Confidence drives transaction volumes, which in turn drives house prices. But with lending remaining constrained, transaction volume cannot recover as strongly as demand suggests it should, and the inability of first-time buyers to get a toehold on the housing ladder is the biggest single risk to the housing market recovery“, he added.

Zoopla.co.uk was launched in January 2008 and has announced record growth despite the property market slump and has won many awards, including the ‘UK’s Most Promising Internet Company 2008?.

Meanwhile, in other news today, the Royal Institution of Chartered Surveyors (Rics) has discovered that a lack of homes up for sale has resulted in the strongest rise in house prices since the start of the credit crunch.

According to Rics, its headline house price balance has grown to its highest level since the autumn 2007. It said that almost one quarter (22%) more surveyors thought prices gained rather than declined during September - this represents the highest proportion since May 2007.