Weak buyer demand sees slump in house prices - Mortgages - News - Moneyfacts

News

Moneyfacts.co.uk News brings you the latest financial & economic news & reviews of the best products in the UK by our team of money experts.

Weak buyer demand sees slump in house prices

Weak buyer demand sees slump in house prices

Category: Mortgages

Updated: 29/07/2010
First Published: 29/07/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

The value of a home in the UK fell by an average of 0.5% in July as a result of continuing weak buyer demand.

There was also a sizable drop in the annual rate of house price inflation from 8.7% in June to 6.6%, according to figures from Nationwide.

Furthermore, the three month on three month rate of change – considered to be a smoother indicator of price trends – fell from 1.7% to 1.3% in the month, significantly below the peak of 4% seen in September last year.

The average price of a property ends July at £169,347, down from £170,111 in June.

"So far in 2010, demand from homebuyers has seen little progress in building upon the recovery seen during much of 2009," commented Martin Gahbauer, chief economist at Nationwide.

"Despite the introduction of a second stamp duty holiday for the vast majority of first time buyers and record low interest rates, the number of properties changing hands across the UK is still running at only half the levels seen prior to the financial crisis and recession."

The gains in prices in the housing market that were seen in the second half of 2009 and early 2010 were driven by low levels of housing stocks.

This has eased, however, as the abolition of home information packs has lessened the cost of putting a home on the market, encouraging speculative sellers to test the mortgage market.

It also appears that some homeowners that became accidental landlords when prices originally fell are re-attempting to sell their homes.

"At the moment, the market is clearly easing relative to the very tight supply conditions that characterised it since early 2009," added Mr Gahbauer.

"However, it will take several more months to establish whether house prices are now simply oscillating a flat price trend or whether a period of downward trending prices may be in store."

If falling prices are enough to tempt you to dip your toe in the mortgage market, the Moneyfacts.co.uk Best Buy tables could well be the place to find the deal to suit your needs.

Find the best mortgage rate - Compare best selling mortgages

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Homemover numbers fall for first time since 2011

The mortgage market enjoyed a record year in 2016, so it may come as a surprise to hear that the number of people moving home has fallen for the first time in five years, with fewer apparently taking advantage of the market.

2016: the best year for remortgaging since 2009

Remortgaging has certainly seen a surge in activity of late, helped in no small part by the dramatic drop in mortgage rates over the last year, so much so that 2016 as a whole proved to be the best year for the sector since 2009.

Homeowners underestimate remortgaging savings

Remortgaging has been enjoying a surge in popularity in recent months, and considering how much you could save, it’s a no-brainer! Unfortunately, many fail to realise the extent of potential savings, which could mean too few make the switch.
 
Close