Scots housing market fights back in crisis of confidence

According to the latest Bank of Scotland Housing Market Confidence tracker, 28 per cent believe house prices will increase over the next 12 months while 24 per cent predict a decline.

The poll also shows that job worries and difficulty in raising deposits are the main hurdles to overcome for those wanting to buy a home.

Three-fifths (59 per cent) identify concerns about job security, with 52 per cent saying raising a deposit is a major barrier to buying property.

Results showed 57 per cent believe now is a good time to buy, almost ten times the 6 per cent who think it a good time to sell.

The survey results mean the House Price Outlook balance for Scotland is positive, with an overall balance score of plus 4 per cent.

This compares with the negative reading of minus 18 per cent in October’s survey when 17 per cent expected a rise and 35 per cent expected a fall in prices.

However, the majority think any house price movement over the next 12 months will be relatively small: 64 per cent expect any movement to be between plus 5 per cent and minus 5 per cent.

Nitesh Patel, housing economist at the bank, said: “The modest improvement in consumer confidence in the outlook for house prices reflects the resilience of the housing market in Scotland over recent months in the face of a weak economic recovery and the deterioration in the outlook for both Scotland and global economies.

“Looking forward, we currently expect broad stability in house prices in 2012, although there remains much ambiguity around this, given the considerable uncertainty regarding the prospects for the economy.”

Scotland was found to be the sixth most optimistic location in regard to house price movements of the 11 UK regions surveyed.

Results also show that 73 per cent predict the cost of renting in the private sector will increase over the next year, compared with just 1 per cent who think rents will fall.

Across the UK as a whole, 29 per cent of those surveyed believe house prices will increase in the next 12 months, up from 28 per cent when a similar report was compiled in October, while 22 per cent predict a decline, down from 30 per cent when the study was conducted previously.

However, most people believe the market will be stable rather than see any sharp change, with two-thirds not expecting to see any increase or decrease of more than 5 per cent. Londoners are the most optimistic, having seen strong overseas buyer interest which could be boosted further by this year’s Olympics, while people in the north east of England, an area that is particular dependent on public sector employment, are the least optimistic.

Those expecting rises outweighed those predicting falls in eight out of 11 regions, compared with just three regions in October.

The Ipsos MORI survey, conducted between 6-19 January, monitors public sentiment in the housing market.

Respondents were asked about property, defined as houses, flats, apartments and all types of accommodation.

A total of 2,009 adults were questioned, including 198 who live in Scotland.