U.K. house prices held their value for a second month in February, boosted by a seasonal increase in demand and a rush to beat the expiration of a property-tax exemption, Hometrack Ltd. said.
The average cost of a home in England and Wales was unchanged from January and 1.4 percent lower than a year earlier, the London-based property research company said in a report today. The number of potential buyers registering with estate agents rose 18 percent over the month, the largest gain for five years.
The figures partly reflect people looking to take advantage of a two-year stamp-duty exemption for first-time buyers purchasing a home for less than 250,000 pounds ($396,000) before it ends next month. Hometrack said the supply-demand balance suggests property prices will resume their decline in the coming months as banks restrict lending and Britons are squeezed by government budget cuts and rising unemployment.
“While the seasonal pickup in demand is to be welcomed, the fundamentals facing the housing market remain largely unchanged,” Richard Donnell, Hometrack’s director of research, said in the report. “In the short term, a lack of housing for sale is set to underpin prices while market activity will benefit from the support of first-time buyers as they race to beat the ending of the stamp-duty holiday.”
Home values declined in six out of the 10 regions tracked by Hometrack this month, while three areas were little changed and London posted a “small increase,” the company said.