28/05/2008 by Damian.

April figures for Mortgage approvals show a 40% decline in approvals on this time last year, further highlighting the effect that the credit crunch is having on the UK housing market.

The Council of Mortgage Lenders has indicated that house prices in the UK could drop by 7% and the number of property transactions could fall to below 1 million possibly reaching levels not seen since the 1970’s.

The main driver being a damaging combination of  previously stretched affordability and a tighter restraint on lender criteria resulting in a low housing market activity.

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10/05/2008 by Damian.

No change in todays interest rate decison.  The Bank of England kept interest rates at 5%.

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10/04/2008 by Damian.

The Bank of England today reduced the interest rate by 0.25% to 5%.

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26/02/2008 by Damian.

The credit crunch is starting to afect mortgage borrowers who are unable to muster a big deposit.  Nationwide has told its customers wanting a loan of more than 75% of the properties value that they will pay higher interest rates to reflect the increased risks involved.

 Nationwide increased its mortgages for home buyers wanting to borrow 75% or more by 0.2%.

 The move will undoubtedly hit first time buyers the hardest especially when you consider that the UK average deposit for a home is 20%.

 To put things into perspective, on a Nationwide home loan for £150,000 a borrower would need to save £37,500 to get the most competitive rates of 5.68.  Last week that deposit would have been £15,000 to get the same rate.

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07/02/2008 by Damian.

The bank of England today decided to cut the UK interest rate by a further 0.25% to 5.25%

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23/01/2008 by Damian.

This year will see at least three interest rate cuts taking the interest own to 4.75%, however, if the USA enters into a recession this could fall to 4%.

How! Well the Bank of England are holding back on ate cuts due to high inflationary pressure predominantly from Energy and food stuffs. However, if the USA enters a recession that will hit consumer confidence in the UK and people will stop spending on the high street thus cancelling out inflationary pressure from energy and food therefore freeing up the possibility of further cuts.

Which ever we look at it, interest rate cuts are coming which is good news for the housing market in general.

The MPC, who decides on whethe ror not to reduce interest rates, kept the interest rate at 5.5% last month but a cut ininterest rates will occur in either February or March, with February a firm favourite.

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06/12/2007 by Damian.

As predicted by Less2sell in our August article Interest Rate Remain Unchanged the Bank of England have today reduced interest rates by 0.25% to 5.5%.

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23/11/2007 by Damian.

The latest NAEA survey has been published and Less2sell have summarised the key points from the September report below:-

The number of house buyers on estate agents’ books was at its lowest for the past four years, with agents reporting an average of 282 buyers registered in comparison to the 326 recorded in October 2007.

The figures reflect the current housing market cool down, as banks, building societies and borrowers tighten their belts following continued uncertainty in the current economic environment. Prospective purchasers are putting their existing buying and selling ambitions on hold as the present cautionary cloud exists.

CAUTION IN THE MARKET

The number of sales agreed per agent was down in October with on average 10 sales reported, compared with 11 in September 2007. This is a significant drop from the same time last year when a figure of 14 sales was reported for October 2006, but reflects the current caution in the housing market.

Meanwhile, the percentage difference between asking price and sales price widened in October to 4.2%, which is an increase on September’s figure of 3.9%, and October 2006’s figure of 3.1%. This widening gap reflects that it is fast becoming a “buyers market” again.

GOOD NEWS FOR FIRST TIME BUYERS

First time buyers increased their share of the market from 8.8% in September to 9.2% in October in a positive step forward. Prices have calmed down in selected areas giving some first timers a renewed enthusiasm. However, this figure is down on the same time last year when first time buyers had 16.4% share of the market.

Less2sell Online Estate Agents feel that in order to restore confidence in the market several interest rate cuts are needed in 2008.

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16/08/2007 by Damian.

       Good news for homeowners with mortgages as this dramatic reduction in inflation has probably removed any potential further increases in interest rates for 2007.

After last months figures, specialists where 80-90% certain of another 0.25% in interest rates, however the chances of such an increase is now less than 50%.

CPI annual inflation – the Government’s target measure – was 1.9 per cent in July, down from 2.4 per cent in June, the largest single drop in inflation for 5 years.

The largest downward contribution came from food prices, as supermarkets led price cuts across a range of products including bread and cereals, meat, fish, fruit and vegetables. In addition, price increases last July on beef and shop bought milk were not repeated this year.

Another large downward contribution came from furniture and furnishings, with average prices falling over the month by more than 10 per cent, a record for July, following record increases for June last month. Widespread sale prices were available on a range of items in July including kitchen, bedroom and lounge furniture.

Other large contributions came from:

• Transport
• Housing and household services
• Recreation and culture

Related links

Beginners Guide to Predicting the Outlook for the Housing Market

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02/08/2007 by Damian.

The Bank of England have held the UK interest rate at 5.75% today, however most economists are predicting one final 0.25% rise before the end of the year.

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