Bloomberg News

U.K. House Prices Stagnated in January as Demand Dropped

January 27, 2013

U.K. house prices stagnated in January and the number of new buyers looking for homes fell as concern over the euro-area debt crisis and the impact of the government’s fiscal squeeze hit demand, Hometrack Ltd. said.

Prices in England and Wales were unchanged from December, after declining for the previous six months, the property researcher said in a statement today. The number of new buyers registering with agents fell 9.9 percent from a month earlier, while the number of properties listed for sale fell 6.8 percent.

A lack of houses and apartments for sale has supported prices, offsetting the fall in demand. Data last week showed Britain’s economy contracted more than forecast in the final quarter of 2012, raising prospects of the first triple-dip recession in its history.

“Fears over Europe, the economic outlook, the impact of austerity, lower incomes growth and mortgage availability have, over the last two years, weighed heavily on demand and kept pricing under general downward pressure,” Richard Donnell, director of research at London-based Hometrack, said in the statement. “Housing demand remains sensitive to the impact of external factors on consumer confidence.”

On the year, house prices fell 0.3 percent, Hometrack said. Still, 79 percent of real-estate agents surveyed were more optimistic about the prospects for the U.K. housing market over the next few months.

In London, values rose 0.3 percent, as global uncertainty boosted demand for homes in the center of the capital, Hometrack said.

To contact the reporter on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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