Categorized | International

Limited Inventory Leads to Increase in Housing Prices in the UK

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For the first time in three months, the average selling price for residential real estate properties increased. The small increase, which was roughly three-tenths of a percentage point, can be attributed to limited sales inventory.

With prices having fallen the past few months, many potential sellers have opted not to put their home on the market. With that said, however, consumer confidence has improved for the first time in many months as fears over the economy have dissipated. The change in the overall perception of the economy will significantly help the housing market gain strength.

The job market in the United Kingdom is still fairly weak, and will likely prevent the residential real estate market from posting truly significant gains in the near future. Though, as long as the sales inventory supply is low, prices should remain stable or even grow slightly.

In comparison to one year ago, housing prices are still down. They dropped by just under one percent from April of 2011.

While up from last month, mortgage approvals are also down in comparison to previous years. They are nowhere near the historic highs that were achieved prior to the housing market crash that took place in 2007.

Optimism over the market has gain slightly, and will likely continue to improve. Many economists, though, believe that it will remain down in comparison to previous years. The job market will have to show some serious improvement before overall consumer confidence starts to regains the strength that it once had shown.

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About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

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