“Despite house prices recording their fourteenth successive monthly increase in June, the tide is most definitely turning.
“Buyers are thinking twice about making such a major investment, worried about overpaying. Another growing concern is affordability, particularly with the looming threat of an interest rate rise, which is now looking increasingly likely.”
‘House prices continue to rise so it is no surprise that first-time buyers are also having to pay more with prices 4.9 per cent higher than in August last year.
‘For those worrying about a house-price bubble, this will only fuel those concerns. But record low mortgage rates generally mean that affordability is not an issue – yet. However, this is something that does need keeping an eye on and borrowers must ensure that they don’t overstretch themselves.’
‘Prices continue to rise but not as robustly as in the past few months, suggesting fears of a house price bubble are overstated.’
‘A bubble implies that people are buying anything at any price and they aren’t. Buyers are being selective and sellers who are set on a certain price with little regard to what the market thinks the property is worth are struggling to sell.’
Nicholas Ayre, director of home buying agents, Home Fusion, said the fractured property market is seeing prices in popular areas supported by a shortage of stock, while elsewhere suffers. He said: ‘Annual prices are back in the red for the first time in six months but, hand on heart, that’s probably where they belong.
It’s a fair assessment that overall prices will move sideways and modestly lower over the course of the next year. But as ever, certain areas will defy economic conditions and prove robust, while other areas will go into freefall.’