Transactions in September increased by 3.4% in the month, up 11.5% compared to last September, reveal LSL Property Services/ Acadametrics House Price Index.
Average house prices registered a 0.2% increase in September. Over the last six months, house prices have registered a modest 1.0% growth. Year on year house price growth slowed to 7.0%, and is expected to slow further as increases in 2010 fail to match those of a year ago.
David Brown, commercial director of LSL Property Services comments: “Historically, transactions slow in September but there has been a welcomed increase in activity this year compared to last. The London market has been particularly active, with sustained investment from foreign investors and cash-rich buyers fuelling an increase in transactions. "Despite the sluggish growth in house prices, there have been some small rises over the last five months but the next few months could see changes. People know that imminent public spending cuts will hit their household finances. Added to that is the problem of mortgage finance, which remains the main hurdle for first-time buyers. And as lenders turn their attention to repaying the £300bn they owe the government in the Special Liquidity Scheme, the market won’t loosen up any time soon. On top of this, the FSA’s proposals in the Mortgage Market Review may well add further constraints to the FTB market. While we won’t see a ‘double-dip’ in the housing market, we don’t expect market activity or house prices to continue their upwards march in the short-term.”