Property marks time in April

The housing market continued to mark time in April with the average price of a house up just 0.82% on the previous month but still below prices seen at the end of 2006. At £222,117, the average property value is up just 3.4% on year-ago levels.

Average house prices rose slightly for both first time buyers and for home movers, reflecting a small Spring pick-up in activity.

The outlook for property for the rest of 2007 remains subdued. The postponement and watering down of the proposed Home Information Packs will deflate a small bubble that had been developing in housing in May.

Robin Amlôt of Moneyextra said, “With HIPs no longer looming over property, one interest rate rise in May and the strong prospect of one or even two more base rate rises to come, the mortgage market will be very quiet.

“While it still appears unlikely that house prices will actually fall back, turnover in the market will fall. More people will choose to stay put – a trend likely to be reinforced by the proposed relaxation of planning regulations, making it easier to expand and improve existing homes.

“That means the market for remortgaging will be where most of the action is going to be in the next 12 months as homeowners look to add value and space to their existing properties.”

The average value of mortgages actually completed by AWD Moneyextra customers in April rose by more than £5,000 to £147,848.35 but that is still well below the levels seen in January and February. The most popular mortgage lender in April was Nationwide Building Society.