The Office for Budget Responsibility (OBR) has forecast that activity in the housing market will recover from its period of stagnation with an upsurge in 2013.
Predictions are that in 2013-14, there will be a 20% increase in transactions compared with 2012-13. These forecasts, which came as part of the chancellor’s Autumn Statement, concluded that the price of houses would increase at levels above inflation from the same year, achieving annual growth of 4.5% in 2015-16.
Decreased mortgage lending, employment worries and unwillingness to reduce asking prices have all contributed to comparatively low sales levels. Figures from the Bank of England, which revealed that mortgage debit was reduced by £9.1bn in the second quarter of the year, are further evidence of a property market ‘treading water’.
OBR has suggested that in 2011-12, transactions would fall by 3%, followed by a 1.5% rise in the next year, then a 20.7% surge in 2013-14.
Housing market to pick-up in 2013, says OBR - BBC News