South-east most positive about house price growth

by Gary Whittaker

Knight Frank and IHS Markit have released their latest House Price Sentiment Index (HPSI), showing how the UK public feel about the value of their homes over the last month. This is a vital early sign of how the market will change, and the latest results show that British homeowners perceive the price of their properties to have risen recently.

Overall, the two firms surveyed around 1,500 households across the country. The results show that 20.6 per cent of respondents believe the value of their home has risen in the last month, while 5.8 per cent said the value had decreased. This works out as a HPSI reading of 57.4, with anything above 50 indicating growth.

This ties in with the previous two HPSI results, both of which stood at 57.5. Knight Frank said that this indicated steady growth in UK house prices, which is positive even if it is not as impressive as the index's high point of 63.2, which was reached in May 2014.

However, the future HPSI - a similar index that shows what UK homeowners expect to happen to the value of their properties over the next 12 months - displayed a more spectacular result of 67.1. This is a rise compared to last month's result of 66.8, although it is still not at the level it was before the UK voted to leave the EU.

Tim Moore, senior economist at IHS Markit, said: "April’s survey reveals that UK households’ confidence regarding the outlook for their property value remains close to its highest since the EU referendum, despite a recent loss of momentum in mainstream house price indices."

These figures are not the same across the UK, however, with regions feeling differently about the value of their homes. The most confident was the south-east, where the HPSI stood at 63.1 and the future HPSI at 77.1.
THe least confident region was the north-east. It was the only area of the UK where households on average believed their property value had fallen in the last month, with a HPSI result of 49.9. It was more positive about the future, with a future HPSI reading of 57.7; still the lowest in the UK.

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24-April-17General Lettings News