DECEMBER’S house price crash was more keenly felt on Teesside than other UK areas, estate agents claim - but it’s not all doom and gloom.
They say competitive property prices have created a buyer’s market - and a stronger foothold for first-time purchasers.
According to Halifax figures released yesterday, house prices fell by 3.4% in 2010 compared with 2009, nosediving 1.3% in December alone.
Agents are blaming economic uncertainty and bad weather, made worse as the Government spending cuts start to bite - but pockets of high sales areas on Teesside continue to do well.
By contrast, agents have also reported buoyant rental markets and are predicting property prices will stay static in 2011.
George Robinson, principal of Robinsons Chartered Surveyors, said: “We have seen a shift downward over the last three months - more so than any other time of the year.
“There’s uncertainty in the economy, and authority cutbacks are starting to have an impact. On Teesside there’s a high percentage of people employed both directly and indirectly in local government.
“It’s the worst negative signals I’ve seen in 30 years, and it’s hitting people’s confidence.
“Price is key at the moment. If prices stay keen and competitive, then things will start to move.
“There are some positives - Ingleby Barwick, Marton and Stockton are still selling reasonable amounts for us. We’re confident it will level off in 2011.”
Michael Poole, of Michael Poole estate agents, is taking the findings with a pinch of salt.
“Statements can be misleading to the public and give a false impression of the market. To put it in perspective, a 1% drop on a £100,000 home is just £1,000.
“House prices in reality have stayed fairly static on Teesside throughout 2010, and should remain so throughout 2011.
“Owner occupiers are looking at property as a home again, rather than as a way to make a few pounds.”
But he claimed difficulties encountered by first-time buyers in securing mortgages were pushing up the rental market on Teesside.
Ian McClelland, partner and senior valuer of Teesside estate agents Thirlwells, agrees.
“Government needs to put pressure on banks and building societies to start lending, especially to first-time buyers,” he said. “People come in to us that want to buy, but they can’t secure financing and are forced to rent.
“A large proportion of our business is in property management for rental market.”
House price drops were positive for the market, he added.
“House prices are more affordable than they have been for the last five or six years now,” he said. “They needed to come down in price because we need that bottom tier of first-time buyers to kick-start the market.
“We’ll still see a tricky few months for house prices. At the moment, it’s still a buyer’s market but things will stabilise in 2011 and prices will remain level for a couple of years.”
The Halifax figures contrast with statistics reported by Nationwide, which showed that house prices edged ahead by 0.4% during 2010, after also rising by 0.4% in December.