House prices are rising again with the Government's Funding for Lending Scheme credited with boosting demand among buyers.

But with a lack of residential property to buy, some economists have raised concerns that house prices could once again spiral out of control.

These fears do not seem to have spread to the wider public, however, if the results of a recent survey are to be believed. 

The most recent Property Tracker Report from the Building Societies Association (BSA) shows just 2% of consumers are worried about another potential housing bubble being created by property prices rising too high too quickly.

Michael Fiddes, head of residential at Strutt and Parker said: “What this shows is that most people believe that talk of a bubble is hyperbole, created by the media. What we really need to do is create a stable market where housing is affordable, and if we can get the supply and demand levels correct, then a free market will find its own level.”

The BSA says that market sentiment is looking up with a fifth of those surveyed saying they thought the market was stable and just 1% considering it to be crashing.

Most consumers (60%) are of the opinion that house prices will continue to ascend over the next 12 months, which is the highest number since the survey started in 2008. 

In addition, fewer people (39%) think that mortgage access is a barrier to the housing market than three months earlier when this belief was held by 46% of respondents and 2011 when this was the opinion of 60% of those questioned.

As mentioned earlier, initiatives such as Funding for Lending and Help to Buy have been largely credited with this success as well as positive coverage in the media.

Director general of the BSA, Adrian Coles, said: “Signs of recovery in the market have been much discussed over the summer and these Property Tracker results confirm an improved outlook. 

“We are, however, still clearly in recovery mode; and the cautious words of those who have been sounding warnings about a market already at risk of overheating need to be listened to, but it would be wrong to take any steps at this point that might damage the recovery in its early stages.”

He added: “At the moment, sentiment across the UK, particularly in markets outside London, is increasingly positive, but still cautious. I have no doubt that the high profile of Help to Buy and the wider availability of 90 and 95% mortgages have helped to improve consumer confidence.”

For more information, get in contact with your local Strutt & Parker office.