The housing market has been unfriendly to Scottish homebuyers and owners, but a new poll suggests consumer confidence is on the rise. Bank of Scotland’s Housing Market Confidence tracker reported 29% of respondents believe house prices will increase in the next 12 months, which is an improvement over the tracker’s more recent reports. Experts note, however, that this increase must be balanced against the fact that Scottish consumers, and particularly prospective homebuyers, are among the most pessimistic in all of Great Britain – and for good reason. For more on this continue reading the following article from Property Wire.
More people in Scotland expect house prices to rise than fall over the next 12 months, according to the latest Bank of Scotland Housing Market Confidence tracker.
Some 29% of respondents forecast that house prices will rise over the next year, whilst 25% of respondents predict a decline in prices over the same period.
This means that the headline House Price Outlook balance, that is the difference between the proportion of people that expect house prices to rise rather than fall, stood at +4 in October. Although this is slightly lower than the reading of +6 in June, it is significantly stronger than the -17 recorded in October 2011.The majority think that any house price change over the next twelve months will be relatively small with 56% expecting any movement to be between plus 5% and minus 5%.
However, the headline House Price Outlook balance in Scotland remains among the lowest in Great Britain. Those living in Scotland and the East Midlands are currently the most pessimistic about the outlook for house prices, both +4%, followed by Yorkshire and the Humber at +5%. In contrast, those living in the South West of England are the most optimistic with an overall net balance of +19%, closely followed by those living in London at +17%.
Concerns over job security and raising a deposit continue to trouble buyers. Some 59% highlighted the challenges in raising a deposit and 54% mentioned concerns about job security as the main barriers to buying a home in Scotland.
Respondents also picked out the general availability of mortgages (35%) and household finances (25%) as major hurdles to home buying.
It also shows that 57% think that it will be a good time to buy in the next 12 months, more than eleven times the proportion of those living in Scotland that feel it will be a good time to sell. Overall, just 2% were positive about both buying and selling over the next year, suggesting that the level of housing market activity is likely to remain subdued.
'Despite some recent weakness, the general improvement in confidence in the outlook for house prices over the past year reflects the relative resilience of the Scottish housing market,' said Nitesh Patel, housing economist at the Bank of Scotland.
'Although the weak economic climate remains a significant constraint on housing demand, the low level of mortgage payments relative to income continues to provide support for house prices,' Patel added.
This article was republished with permission from Property Wire.