By Suban Abdulla
LONDON, March 20 (Reuters) - The average price of homes
coming on the market in Britain stabilised in March and activity
is picking up towards more normal pre-pandemic levels after last
year's "mini-budget" upheaval, a survey showed on Monday.
Property portal Rightmove said asking prices for homes rose
by a monthly 0.8% in March after the weakest February in records
going back to 2001 when they flat-lined.
However, this month's growth was below the 1.0% average
monthly increase for March over the last 20 years with property
sellers more cautious than usual about pricing.
Tim Bannister, Rightmove's director of property science,
said higher mortgage rates and economic headwinds posed
challenges but the housing market seemed to be stabilising more
quickly than expected after its hit in late 2022.
While borrowing costs have eased from their peak, they are
still nearly double their level before former prime minister Liz
Truss's unfunded tax cut plans - part of her "mini-budget" in
September of last year - which caused turmoil in bond markets.
The Rightmove survey showed sales agreed in the first-time
buyer segment were improving faster than larger homes which were
in demand during the COVID-19 pandemic frenzy for more space.
Britain's official budget forecasters, the Office for
Budgetary Responsibility (OBR), said last week house prices
looked set to fall by 10% this year amid the squeeze on incomes
and higher borrowing costs.
Households have faced double-digit inflation since September
and the OBR said the country remained on track for a record fall
in living standards over the two years to March 2024.
The OBR also forecast inflation would fall to 2.9% by the
end of 2023. The Bank of England is weighing whether to raise
interest rates again this week after 10 consecutive increases
since late 2021 to try to bring inflation back to its 2% target.
($1 = 0.8235 pounds)
(Reporting by Suban Abdulla
Editing by William Schomberg)
