Homeowners' house price expectations cooled in August

Households' confidence slipped in August as people continued to feel downbeat about their current and future finances and faith in the housing market was dented, an index has found.

Thursday, 30th August 2018, 7:00 am
Updated Monday, 3rd September 2018, 12:17 pm
The housing market is set to remain subdued and retail faces another hit

The consumer confidence index from YouGov/Cebr (Centre for Economics and Business Research) had an overall reading of 109.0 in August - slightly down from 109.1 in July.

Readings above 100 represent a positive score and those below this point indicate people’s perceptions are negative.

People were asked various questions about finances to produce the overall reading.

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When asked about their household finances over the past month, the score in that category was a negative one of 92.4 - the same reading as in July.

The reading for household finances in the next 12 months was 98.8 - a negative reading but an improvement on the 97.3 reading in July.

Homeowners were also asked about how they expect the value of their home to change in the next year.

The reading in this category was 128.6 - a positive reading but the lowest score seen since July 2017.

Business activity in the workplace over the past 30 days has also declined to levels not seen since August last year, the report said.

Nina Skero, head of macroeconomics at Cebr, said: “Based on the August results of the YouGov/Cebr consumer confidence index, the housing market is set to remain subdued, at least in the immediate future.

“This will be particularly problematic for the economy if it encourages consumers to tighten the purse strings and pull back on spending.”

YouGov conducts more than 6,000 interviews a month with people aged over 18 to produce the findings.

The index report comes inthe same day as it emerged British retailers have been warned to brace themselves for a potential £320 million “warm weather” hit to revenues next month as higher temperatures melt sales.

According to a report published by the British Retail Consortium (BRC), warmer weather in September could cost non-food retailers £80 million per week.

Based on a Met Office analysis of weather data, it argues that there is a “clear relationship” between temperature and retail sales.

The impact is strongest from mid-August to early October, when warmer weather delays the purchase of autumn-winter ranges.