Rightmove Consumer Confidence Survey Q1 2010 - Majority in UK Expect Further Price Increases in 2010

Jan 27, 2010, 07:54 ET from Rightmove Group Ltd

LONDON, Jan. 27 /PRNewswire/ --The first Rightmove Consumer Confidence Survey of 2010 reveals a remarkable year-on-year shift in the expectations of the British public regarding house price trends. In our Q1 survey for January 2009 we posed the question: "Where do you think average house prices will be one year from now?" The results showed that just under 10% of respondents believed house prices would increase over the next 12 months. Now, one year later, the Q1 2010 survey finds that more than half (53%) of all respondents believe that house prices will increase in the year ahead. Positive price sentiment is a major force in any housing market recovery and this, the first insight into sentiment in 2010, provides a very encouraging indication from a consumer viewpoint of how prices might perform.

Miles Shipside, commercial director of Rightmove comments: "Given the looming election and the talk of pending austerity packages ahead, this consumer survey highlights a surprisingly positive property price outlook."

Why is the public so confident about prices increasing over year ahead?

The UK appears to be on the verge of coming out of recession and while the road to economic recovery will require tough fiscal measures, the current conditions of house price stability have provided a sufficient level of confidence for more home-hunters to re-enter the market. The Rightmove website saw record levels of traffic in the early weeks of 2010 and this heightened level of activity coincided with the average UK asking price going up by 1.2% in the first week of January alone.

Miles Shipside adds: "The property market is in a virtuous circle scenario, where consumers are seeing less property up for sale and fresh to the market property selling more quickly. That rightly gives them the impression that we are over the worst of the recent price falls, and that there is likely to be upward pressure on prices."

What has caused this turn-around in consumer confidence?

In January 2009 there was considerable uncertainty within the property market following on from the financial market crises of late 2007 and early 2008. The average asking price of property coming to the market had fallen 21,649 pounds Sterling (-9.2%) in the space of 6 months against a backdrop of mortgage availability being slashed and the economic recession taking hold. Although these factors have yet to ease fully, property prices have steadied to the extent that 2009 closed with average asking prices up by 4.1% year-on-year.

Shipside explains: "Employment seems to be holding up, and forced sales have been below forecasts. People hear these positive stories in the news and also directly feel the benefit of base rates being at record lows. Those that have a mortgage, or can get a mortgage to move, are finding it is soaking up less of their disposable income. In many ways, 2009 turned out to be much better than expected and the confidence we report amongst the public is a reflection of that."

Contact:  Tom McGuigan, Rightmove Press Office, press@rightmove.co.uk, +44(0)207-087-0700

SOURCE Rightmove Group Ltd