According to a report from Reuters today, there will be a gradual increase in the price of houses over the next two years. However, this latest quarterly property poll expresses the opinion that the market is ?increasingly overvalued against shaky fundamentals?.
The Reuters poll surveyed 29 economists and the results saw house prices increasing by rising 2 per cent in 2010, then by almost the same amount, 1.9 per cent next year. This stands in comparison to the same poll carried out in January of this year which predicted a growth of 1.6 per cent and 2.5 per cent for the next two years respectively.
19 out of 25 respondents to the poll said that they believed prices appeared very high, rating the market at the moment 7 out of 10, where 10 is ?extremely overvalued?.
?The housing market continues to look overvalued ? all the more so given the recent rise in prices far in excess of income growth,? said Peter Dixon from Commerzbank in London. ?We look for only a modest rise in prices from here over the course of 2010, which will help to ease valuation pressures somewhat.?
Halifax announced last week that the increase in houses for sale was starting to influence the supply and demand imbalance, which has led to curbed house price growth in recent times. The Royal Institution of Chartered Surveyors (RICS) backed this up by stating that people seem more keen to place their properties on the market at the moment before the country goes to the General Election.
