Homeowners' confidence 'remains stable

Confidence in house prices has remained unchanged for the past three months, research published today showed.

Mortgage lender the Woolwich said that in June almost half of UK homeowners were expecting property prices to rise in the next year.

The figure of 49% matched that in April and May's editions of its monthly confidence survey. This is the first time since the survey began in 1988 that confidence has remained at the same level for three consecutive months.

The number of people anticipating price growth is down from a figure of 65% in June last year, but up from last December's low of 39%.

Figures for June show the number of homeowners predicting price falls stands at 6.5%, down from 6.8% in May, and the number expecting no movement in prices standing at 44.5%.

A spokeswoman for the lender said that the number of people predicting a fall tended to hover around 5-6%, regardless of the strength of the market.

Although on a national basis confidence has remained static, the Woolwich said there have been regional fluctuations. In Wales, confidence has improved with the number of people expecting higher prices rising 3% over the past three months to 49%, while in the south-west the 50% predicting price inflation is 13% up on the figures for April 2005.

A number of other areas have seen confidence fall: in the north-east 52% said in June that they expected price rises, compared with 58% in April, and in the south-east, north-west, Yorkshire and London the number expressing confidence in the market had fallen by one or two percentage points.

According to the Woolwich, confidence remains highest in Scotland, with 61% of those questioned saying they expected property prices to be higher in 12 months' time.

"Confidence has stabilised after improving considerably from a historic low of 39% in December 2004, continued interest rate stability will no doubt help to maintain and improve confidence," said Andy Gray, head of mortgages at Woolwich.

The Woolwich's figures are released at a time when housing market commentators are suggesting a slowdown in property prices.

A survey published today by property website Rightmove suggests that asking prices have fallen by 1% so far in July and that homes are now worth just 0.2% more than they were this time last year.

And last week Halifax said prices were up 0.1% in June, but annual price inflation was, at 3.7%, at its lowest level since March 2001.