The Bank of England cut interest rates to a new record low of 1% on Thursday. While the Halifax reported that house prices rose 1.9% during January. This is in contrast with Nationwide’s figures last week which showed 1.3% drop in house prices. As the credit-crunch has shown, the supply of finance has driven up house prices. There will be no full scale recovery in the UK property market until finance becomes easier to obtain, especially for first-time buyers. And with rising unemployment, who knows what the future will bring!
Posts Tagged ‘House prices’
Base rate falls while house prices rise
Friday, February 6th, 2009£300bn wiped off value of British homes
Thursday, June 12th, 2008Britons have collectively seen nearly £300 billion wiped off the value of their homes since house prices first began to fall in September last year, research by property valuation website Zoopla.co.uk has showed. This is equivalent to more than £1 billion a day being wiped off the collective value of British homes. But it added that the recent price falls should be seen in the context of strong gains in recent years, with the value of Britain’s housing stock soaring by £750 billion during the past three years and £1.7 trillion during the past five years.
£5k fee to take out your next mortgage
Wednesday, April 16th, 2008Homeowners are facing fees of up to £5,000 to take out a mortgage. A devastating report released yesterday shows that the average cost has almost doubled in a year. Interest rates charged by banks have also gone up. Separate Government figures out yesterday brought further bad news in that house prices are falling at their fastest rate since records began. After all the panic in the mortgage market, people may be tempted to grab the best headline rate deal but the fees must also be taken into consideration. HSBC charges up to £5,000 for its recently introduced ‘Rate Matcher’ deal, which lets homeowners whose current fixed-rate deal is about to expire get the same rate with HSBC for another two years. The mortgage meltdown continued yesterday with the number of deals available falling to just over 4,000 from 15,599 last summer.
House prices dropping by £120 a day
Monday, January 21st, 2008House prices are dropping around £120 a day with experts warning that the year ahead looks bleak. Rightmove reported that prices have dropped by a total of nearly 5% since October, including a 0.8% decrease this month. Asking prices have fallen by up to 40% on some properties in recent months, according to website Property Snake, which gives details of asking prices which have been slashed. The price falls are hitting some parts of England more than others, with prices still rising in London and the North. The biggest loser is the East Midlands with prices dropping 6.1% in January alone. It is a cruel blow for anybody who recently stretched themselves to the limit to buy a home.
Is falling house price such a big deal?
Wednesday, January 16th, 2008The one question which nobody seems to ask is – does it matter if house prices fall? If you don’t need to move home and can meet your mortgage repayment commitments, the value of your home, in the short term at least, is immaterial. Even if you have to move house, if the value of your own property has fallen by 10% then the likelihood is that the property you want to buy will have fallen by a similar proportion. For homeowners trading up, falling house prices are a positive advantage. Ultimately, lower house prices will make homes more affordable and bring larger numbers of first-time buyers into the market, many of whom have been priced out. It is also a time when experienced investors look to buy at the right price. When house prices go up, people have the confidence to spend (home improvements, furnishings etc), which keeps the economy going. Falling house prices however, make them much more reluctant to do this.
Rate of house price falls not seen since 1992
Wednesday, January 16th, 2008House prices are falling as quickly today as they did in the crash of the early nineties and only further cuts in interest rates will avoid a property meltdown, according to the Royal Institution of Chartered Surveyors (RICS). Its statistics show that nearly two-thirds of surveyors saw prices falling in December and virtually none say they are rising. The crunch has hit almost every part of England and Wales, while the West Midlands is suffering its fastest fall in history. However, the RICS says market conditions are better than before the 1990s crash. The coming months will be of great importance and many would-be-buyers (as well as homeowners on tracker rates) will be watching the Bank of England’s interest rate decisions while lenders remain reluctant to part with finance.
House prices to stagnate in 2008
Saturday, December 8th, 2007Britain’s number one mortgage lender, the Halifax is predicting that the property market will stagnate in 2008 even if the Bank of England cuts the base rate to 5%. This is good news for home owners in comparison to other predictions of falls of 10 to 15 percent next year. But not so good for people still struggling to get on the property ladder. A report for the global finance monitor said that house prices in the UK have soared in relation to incomes and now stands at about 9x annual average earnings. Up from about 5x in 2001.
