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| MONDAY 16TH MAY 2005 |
 POSITIVE
UK HOUSE GROWTH ON THE HORIZON
The housing market has reached the turning point of its current
slowdown according to figures released by the new homes website,
SmartNewHomes.com.
The average price of a new home in the UK last month was £256,143,
down 8.1% since the same time last year – the most
significant price decrease of the current slowdown which
has seen consistent negative annual growth since last October.
However month-on-month, prices were down just 0.3% the smallest
monthly decrease seen this year, indicating the stabilisation
of the current slowdown and a possible return to rising prices
in the next few months.
David Bexon, chief executive of SmartNewHomes.com, comments: "These
figures give further weight to the general consensus that
the housing market, as well as the wider economy, are in
fragile states and need handling with care. Retail sales
are at their lowest level for a decade, the rate of inflation
is accelerating, and rapid house price growth across much
of the country is a distant memory."
"However with the predicted election result confirmed
and the Bank of England’s Monetary Policy Committee
once again making the sensible decision to maintain interest
rates at their current 4.75% level, house buyers are ready
to start returning to the market."
"A stabilisation in the current slowdown is already
being hinted at by the consistently diminishing negative
monthly price changes and positive monthly growth could be
a realistic possibility within the next couple of months – in
reverse from the decreases we have seen in ten of the last
twelve months."
Regionally, prices are already starting to increase in many
of the areas which tend to set the course for UK house prices,
i.e. the South West, South East, East Anglia and West Midlands,
all of which experienced price increases over the last several
months. In contrast, the North West, North and East Midlands
have seen average new home prices decrease and Wales replaced
Scotland as the cheapest region in the UK. London remained
the most expensive despite price falls of around 6.6% in
the last six months.
The percentage of new apartments available to buy increased
once again, completing six months of consistent increases
which has seen the proportion rise from less than third (32%)
of all new homes at the end of last summer, to a dominant
majority of almost two thirds (57%) last month. In relation,
the percentage of detached homes fell to a new low of less
than 30%.
David Bexon comments: "With Labour now given another
four years to implement their policies on regeneration and
sustainable communities we can expect to see further changes
in where, when and how our new homes our built. The government
have now got the mandate for change and after all the talk
of building more homes and streamlining planning systems
it is time to grasp the nettle and put those statements into
action."
"Policies need to be implemented at a local level to
allow house builders to build the houses people want to live
in, not the houses that the government wants them to live
in. The affordable sector is being addressed by the government
and house builders’ own initiatives but not everyone
wants to live in an affordable home."
"Aspirational homes are still needed, homes where families
have space to live. The current generation of growing families
should not be constrained by the misguided policy priorities
of central government and should be given the same opportunities
as previous generations."
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