LMS comments on the latest ONS house price index, January 2015

Andy Knee, chief executive of LMS, comments on the ONS House Price Index, January 2015

“With the inflation rate dropping to zero for the first time on record and house prices rises down from December of last year, we continue to see a cooling in the market prior to the election in May; a pause of uncertainty as consumers wait for an outcome. The market jitters are likely to fade towards the second half of the year, once an elected party is established, bringing with it its own set of agendas and a greater level of certainty.

“The figures also imply that changes in stamp duty haven’t had the impact predicted following the Autumn statement, when it was expected that a flurry of owner-occupiers would drive a short-term rise in activity. There is a possibility that cautious homeowners are waiting for the election to pass before taking advantage of the reform.

“While owner-occupiers have seen prices rise, sadly, it is first-time buyers who have seen a sharper rise compared to January of last year, an indication that they are still far off from fulfilling their homeownership dreams; clearly, the cooling has not translated into a healthier first-time buyer market yet and even the chancellor’s new help to buy ISA will not solve all their problems.”