Though still 46% below the pre-crunch average for the period, housing transactions in the first quarter of 2012 were at their
highest level since 2008. This corresponds with improved demand for mortgage finance reported by the Bank of England in their Q1 Credit Conditions Survey.

However, at a national level the Nationwide, Halifax and Land Registry data all suggest UK average house prices little improved, with supply and demand both subdued, though broadly balanced according to the RICS.

Land Registry figures continue to show a wide divergence across the UK. In Oxfordshire prices rose 2.8% in the year to February 2012 to leave them just 4.8% below peak. By contrast, prices fell by 9.0% in County Durham to leave them 29% below their peak.

London calling

London continues to be the strongest regional market, but there is huge divergence in activity levels across the city. In Islington, annual transaction levels are running at 82% of their pre-crunch norm, while, in Barking and Dagenham they are down 57%

With little sign of improvement in the availability of mortgage finance and an increase in the standard variable rate of interest charged by some lenders, there seems little prospect of a sustained improvement in mainstream market activity over the next two years at least, as reflected in our house price forecasts.

Taken from
Residential Property Focus 2012 Q2