Hometrack recorded growth in May at 0.6 per cent compared to 0.7 per cent in April and the year-on-year rate also slipped back from 6.8 per cent last month to 6.7 per cent.
find out more about this weeks industry news
The survey revealed weakening demand, with no increase in the number of new buyers registering with agents. Hometrack stated this could in part be explained by increasing resistance to pricing levels, together with widespread expectations of an interest rate in May and the threat of more to follow. Sales levels grew by 4.3 per cent over May compared to a 9.6 per cent increase in April.
While demand decreased, the survey showed a 6 per cent increase in properties coming to market over May, up from 5.7 per cent in April.
get the daily news delivered to your inbox
Richard Donnell, Hometrack’s director of research, said: “The steady ratcheting up of interest rates was bound to take its toll eventually. We expect the headline rate of growth to slow relatively quickly over the rest of the year towards 4 per cent as affordability pressures put a continued squeeze on purchasing power and as more supply comes to the market. The expected slowdown will be exacerbated by any further increases in interest rates above the current 5.5 per cent.”
download our news ticker
Rod Murdison, proprietor of Murdison & Browning, commented: “There does seem to be a lot of activity in the market, with a whole host of people putting their properties on the market in the first half of the year. There seems enough supply at the moment to take the pressure off forcing house prices up any more.”
