One in three Britons expects house prices to increase this year

Britons feel confident about the housing market, with a third of people expecting prices to rise during the coming year, a survey has suggested.

Around 32 per cent said they thought property values would increase in the next 12 months, compared with only 23 per cent who thought they would fall, and 26 per cent who thought they would be broadly unchanged, according to high street bank Halifax.

People are more optimistic about house prices in their local area, with 35 per cent expecting the cost of property to increase where they live and only 18 per cent predicting falls.

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But regardless of whether they feel positive or negative about the market, the majority of people are not expecting big price swings, with 57 per cent expecting changes to range from rises of 5 per cent to falls of 5 per cent, and only 24 per cent are expecting bigger changes.

The boost for the housing market comes despite news earlier this week that house prices had plunged in the past year. Statistics released on Wednesday showed that the average value had fallen 4.2 per cent over the past 12 months.

Low earnings growth, high inflation and increased taxes were blamed for "weak" confidence, which had caused problems in the market.

The new survey shows half think it would be a good time to buy a house in the next three months - more than three times the 14 per cent who think it would be a good time to sell a property, suggesting consumers still think it is a buyers' market.

But low levels of consumer confidence are likely to put many off purchasing a new home, meaning transaction levels are likely to remain low.

Around 26 per cent said they expected their finances to get worse during the next few months and 54 per cent did not think they would improve. A further 52 per cent said worries about job security would stop them buying a property, while 22 per cent were concerned about rising interest rates.

Half of those questioned also said raising a big enough deposit was a major barrier to buying a home and 27 per cent thought the lack of mortgage availability was a problem.

Suren Thiru, housing economist at Halifax, said: "More Britons expect house prices to rise rather than fall over the next year. However, confidence in the UK housing market is likely to remain subdued over the coming months, given consumers' concerns over the outlook for the UK economy in general, and the jobs market in particular."

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• Economists hope to see "moderate improvement" in the economy during the rest of this year, which they say should help support an increase in demand for housing and prevent further falls in the prices. Ipsos MORI questioned 987 people during April.