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UK Property NewsUK House Price News - July 2008
June 5th 2008 More gloom on housing front. Surveys from some of the major players in the UK property market indicate a steady fall in house prices with a possible fall in value of up to 20% during 2008. Fears of a price drop and the continuing 'credit crunch' making mortgages more difficult to obtain and more expensive have ensured that the number of mortgages over the last months has remained low. May 16th 2008 Fewest new mortgages for 33 years say Council For Mortgage Lenders. According to recent figures from the CML the first quarter of 2008 saw the fewest number of new mortgages since 1975. First time buyers were also at record low levels as the credit crunch continued to bite on the UK housing market. Recent actions by the UK government to increase the flow of money available for new mortgages are yet to show significant results and the outlook for property prices is steadily downward for the foreseeable future. Predictions for house prices drops through 2008 vary between a conservative 5 - 10% and a thoroughly scary 20% over the year. May 1st 2008 Slight drop in prices during April. Last month saw an estimated 1% - 2% drop in prices and figures from the Bank of England indicated that new mortgage approvals were at their lowest since the 1990's as first-time-buyers find it more and more difficult to raise the increasingly large deposits that banks and building societies are asking for. As the lenders have moved to limit possible exposure to bad debts, mortgages have become more difficult to find and more expensive and demand for property has slowed further with new mortgage approvals running at just over half of this time last year. April 18th 2008 Bank Frees up cash to fund Mortgages - The Bank of England announced plans this week to swap government backed bonds for mortgage assets with banks and building societies. It is hoped that this will encourage banks to lend more to each other and help free up cash for lenders who are currently underfunded due to the credit crunch. Banks have been finding it increasingly difficult to borrow money in order to lend it on to their customers and this lack of funding has made mortgages and remortgages more difficult to find and more expensive. Leading bankers met with Prime Minister Gordon Brown earlier this week to discuss the current funding issues. It's been widely predicted in the City this week that RBS which owns Natwest has plans for a rights issue to raise cash from its existing investors. The bank, which has recently used a large chunk of its cash reserves to purchase a major Dutch bank is expected to make an announcement next week. House prices continue to fall as we move into early summer with the market remaining quiet and vendors having to discount quite substantially in order to shift their properties. April 1st 2008 The housing market continues to look flat according to more reports this week. Predictions from building societies, banks and estate agents for 2008 are that the year will see either zero growth or a slight drop in house prices - which, if it happens, will be the first drop in 13 years. Lenders provided just under 44,000 mortgages to home buyers in February, slightly up over the previous month, but down a third over the same period last year. The number of different mortgages available has also fallen sharply with big reductions in the number of finance packages available in the sub-prime (poor credit history) marketplace and buy-to-let areas. As well as being more cautious about who they lend to, the mortgage providers are also asking buyers to put down bigger deposits.
Housing : From next month, key workers like teachers and nurses, will be able to borrow money from shared equity schemes. Key workers now only have to find up to 50 per cent of the property value rather than 75 per cent. Shared ownership homes will be exempt from stamp duty until occupants hold 80% of their homes value. However, first-time buyers will have no respite from stamp duty. Alcohol : From midnight on Sunday the price of beer rises by 4p a pint, wine by 14p a bottle, spirits by 55p a bottle and cider by 3p a litre. Motoring : Mr Darling's most unpopular budget move however, was in targeting drivers of family cars with a new 'showroom tax'. The tax rises are an attempt to fight climate change. 'Gas-guzzlers', such as estate cars and people carriers, and cars that emit high carbon dioxide levels are going to cost a lot more to run. Their owners will also pay higher road taxes from 2010. Tax : The 10 per cent income tax band will disappear from April, which will mean many low earners will see their marginal tax rate rise. February 27th 2008 The housing market remains flat according to a report this week from the British Bankers Association with new mortgages down almost a third from the same period last year. Remortgages acounted for almost half of all mortgage business as borrowers reach the end of fixed term deals and cast around for a better rate. Borrowers with mortgages to a higher proportion of their property value are facing higher rates as lenders limit their exposure to riskier business. The buy-to-let market remains bouyant though, with demand for rental property staying strong. Buy-to-let mortgages were up by 23% last year according to the Council For Mortgage Lenders and now consitute over 10% of UK mortgage lending. February 7th 2008 The UK Interest rate is cut by a quarter percentage point to 5.25%. This is seen as an attempt to stop the slowdown in the UK economy - consumer spending is down and the property market has slowed due to the recent sub-prime credit crisis. There has also been a fall in mortgage approvals. The Bank of England's quarterly Inflation Report is due next week, which should give a clearer picture of the future inflation rate and also likely borrowing costs. January 31st 2008 A quick look at the latest crop of surveys shows the market still flat with prices slightly down or static against last month. Buyers continue to be cautious, fearing a larger drop in prices although analysts are still forcasting a stalled market rather than a price crash in 2008. Industry insiders are hoping that a widely anticipated UK Base rate cut of 0.25 per cent on February 7th will help to steady nerves and get the market moving again. January 21st 2008 Property prices continue to flatten with figures released last week by the UK Communities and Local Government department showing the average house price in November 2007 down just under £2,000 from the previous month. The department also revealed that annual house price inflation in November was 9.5 per cent down 1.8 per cent from October. January 4th 2008 Both the Bank of England and the lenders say that new mortgages ( i.e those for buying a home rather than remortgages ) hit their lowest level since 2005 in November 2007 - the latest month for which figures are available. The depressed housing market continues amid gloom over the slowdown in the economy with buyers reluctant to purchase in case of a price drop. Housing pundits point at the likelyhood of a flattening of prices rather than a crash but with the sub-prime and Northern Rock issues yet to reach a conclusion and the high street reporting a quiet December, the mood is one of pessimism. Latest BBC Property News (external link - opens in new window) Business loan
- find out about a business loan 2007 - December 17th - House Prices Stalling?Evidence from estate agents and industry observers suggests that houses are starting to be discounted. A glut of smaller homes being rushed onto the market to beat the December 14th introduction of HIP's on all UK residential property together with worries about more expensive mortgages helped to keep house prices lower. Despite a quarter point cut in the UK base rate banks and building societies are still finding wholesale borrowing expensive and are passing this on to their customers. The sub-prime crisis continues to bite with more and more mortgage applications declined on the basis of customer credit or earnings issues. Early reports from retailers point to a busy Christmas making it less than certain that the perenially cautious bank of England will cut rates again next month. December 6th - Current UK average house price stands at £183,896 according to last months figures from the UK Land Registry. London House prices continue to grow ahead of the rest of the UK with the average property costing £354,272 according the UK's Land registry figures for Sept 2007. Over the UK as a whole, the annual growth rate in house prices has fallen slightly to an annual increase rate of 8.7% against the average 9.3% increase over the preceding four months. The number of new mortgages approved in England and Wales also fell sharply by 6,000 to just over 102,000 in September 2007. A year ago in September 2006 the figure was closer to 130,000 new mortgages. Our comment - The jittery financial markets continue to undermine confidence and although the London property market remains reasonably bouyant, the rest of the country is slow. The mood seems to be 'wait and see' amongst property buyers and everyone else too! The retail business is waiting to see the Christmas shopping results and the finance markets are waiting for the sub-prime and Northern Rock dust to settle. The Bank of England is waiting for the outcome of everyone else's waiting before making a decision about cutting the base rate again but the prediction is a further quarter percent cut in January 2008. Queens Speech - Brown promises three million more affordable houses Home Information Packs for everyone! 'No UK Autumn Base Rate Rise' say pundits Important Checks Before You Sign Up For a Loan Getting a Loan when you have a bad history 'more difficult' say Lenders Stamp duty threshold at £125,000 since March 2006In his budget of March 2006 Gordon Brown again raised the exemption
level for Stamp Duty, after having doubled the starting threshold for
residential stamp duty from £60,000 to £120,000 during 2005.
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March
12th 2008 Chancellor Alistair Darling has delivered his first
budget and it is being termed as the 'hangover budget', due to his
rise in alcohol duties, increasing by 2 per cent above the rate of
inflation for the next four years.
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