Halifax forecasts flat UK housing market in 2010

Hot on the heels of the Nationwide Property survey which suggested a 10% to 15% increase in UK property prices in 2010, the Halifax survey is very different. After revealing that house prices grew by just 0.6% in January 2010, against a six monthly average of 1.1%, there are growing fears that more properties will be brought to market which will see pressure on prices.

The average home in the UK is now worth just under £170,000, a 9.9% increase on last year's April low, although the forecast of a flat property market in 2010 is very much at odds with the Nationwide Survey. However, there are already signs that more properties are being placed upon the market with many sellers desperate to take advantage of the recent improvement in house prices and sell-up and move on.

Even though the recent closure of the Bank of England's quantitative easing program will impact upon liquidity it will also ensure that UK base rates are likely to remain at 0.5% for a further prolonged period. This will obviously assist with regards to mortgage rates and competition in the sector but if more properties become available and mortgage lending does not increase then we will see more downward pressure on prices.