Paul Hunt, managing director of Phoebus Software Ltd, said: “Double digit house price inflation is a significant landmark to reach but there are issues which could seriously de-stabilise the recovery in the property market. A hung parliament is looking increasingly likely by the day. This may not cause too many problems on its own but without an outright election winner we’re in serious danger of a ratings downgrade. If that happens then all bets are off.”
David Smith, senior partner, UK property consultancy, Carter Jonas, said: "The property market may have edged into double digit territory but it's important to put this symbolic price point into context.
"The price rises of the past year have been driven primarily by a shortage of stock rather than strong demand. They are also being supported by low interest rates, which will only remain at the current level for so long, and possibly not as long as some think given rising inflation.
“Once interest rates rise, the pace of price growth will become more subdued and there may be an adjustment in the second half of the year.
"Many buyers are currently sitting on their hands, waiting to see how the General Election and a second potential Budget pan out before they commit to transact."
Tim Hammond, chief executive, of property search experts The Buying Agents, commented: "The concern is that this house price recovery is being fueled entirely by fear and uncertainty amongst buyers and sellers, rather than an efficiently performing market. On the one side you have buyers who are being told by estate agents that they must buy now because property prices are rising rapidly and they could miss out. On the other side, you have sellers who are reluctant to put their properties on the market until the General Election is over. The picture will be much clearer post May 6th.
"At the moment we are seeing a lot of sealed bids from buyers on the few highly desirably properties on the market. We're also likely to see over the coming months plenty of homebuyer's remorse, from buyers who regret being pushed into buying a property they didn't really want.
"Hopefully, once the General Election is behind us, a semblance of certainty and normality will return to the market, and we may start to see a market that is operating not on fear, but on the true value of a property and what a buyer is prepared to pay. This is likely to result in prices dropping in the short term, but in the longer term we should see steady growth and a sustained market recovery, built around firm foundations."
David Whittaker, managing director of Mortgages for Business, said: “These figures represent the end of the current bull-run and activity will now drift as the impact of long term national debt is taken on board by all borrowers. The distractions of the last few weeks with heightened interest in the general election and the disruption of the volcanic ash episode has slowed down market activity in April. The window of opportunity for increased activity before the summer break will be shortened by the start of World Cup on the 11th June. And we certainly can’t ignore the unfolding events in Europe without some concern on sentiment.”
