UK housing market gains momentum

The number of people in the UK who believe that the value of their home increased in value remained high in May despite various market uncertainties, the latest House Price Sentiment Index (HPSI) from Knight Frank and Markit Economics shows.

The research reveals that many households remain confident that the price of their home is increasing. In fact, households in all 12 regions covered by the index reported that prices rose in May, with those living in London perceiving that the value of their home had risen at the strongest rate.

The future HPSI, which measures what households think will happen to the value of their property over the next year, shows that households in every region of the country - for the 14th consecutive month – expect the value of their home to increase over the next 12 months.

With residential property market conditions improving, 5.4% of households said that they planned to purchase a property in the next 12 months, up from 5% in April.

Gráinne Gilmore (pictured), head of UK residential research at Knight Frank, said: “The housing market is gaining momentum across many parts of the UK, although it is worth noting that households in the North East did not perceive that the value of their home rose over the last month, but rather reported that prices remained unchanged. This underlines the localised nature of the housing market across the country, which is moving at different speeds.

“The strong price growth seen in other areas including London and the South East is underpinned by a lack of supply, both new delivery of homes into the market as well as a lack of second-hand stock coming onto the market for sale, in the face of rising demand.”