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Confidence in housing market slumps

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Brits are feeling less confident about the future of the housing market following the general election.

Data from Halifax showed the percentage of people feeling confident about the market was 68%, up from 64% in May – before the election took place.

Despite this drop, confidence is still higher than in January when it registered at 52%.

However, the current drop in confidence comes as the average house price topped £200,000 for the first time ever.

More than half (56%) of people said now was a good time to buy a property, lower than the 61% of people who believed this in May.

Londoners were less likely than those elsewhere to say it is a ‘good time to buy’, only 38% of Londoners agreed with this sentiment. The capital is the only area where more people believe it is a bad time to buy than a good one.

Following announcements from Bank of England governor Mark Carney, the proportion of people expecting an interest rate rise in the next 12 month grew to 48%.

Martin Ellis, housing economist at Halifax, said: “Economic growth, together with increasing real earnings growth and historic low mortgage rates are all supporting the continued rise in house price optimism. It’s not been a smooth increase though as while there was a noticeable spike in optimism straight after the General Election result, this has now fallen off slightly.

“A key factor in maintaining optimism over house price growth has been the fact that the stock of homes available for sale is currently at record low levels. If this growth is to be sustainable then we need to see a comprehensive house building plan rolled out across the UK, and soon.”

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