Though David Cameron, the leader of the conservative party, keeps saying the UK economy is in recovery the evidence really doesn’t bear that out. In recent months economic reports have all been bad news about the UK economy and with the coalition government’s economic blinkers firmly in position, it’s expected that we are going to see a lot more house repossessions in the future as we descend into the verge of a double dip recession. Recent comments point to a total washout when it comes to assessing the coalition’s economic “strategy”. According to the governor of the Bank of England, Mervyn King, the value of workers pay is in the steepest decline since the 1920′s.
More on Massive UK Public Sector Job Losses Likely to Increase Number of Foreclosures
The spotlight will soon turn on to the property analysts across the country to give their 2011 predictions for the market. But with the unpredictability that saturated the industry in 2010, many will be apprehensive about giving concrete opinions regarding how the market will evolve over the next 12 months.
After a stronger start to the year, recent activity in the property market has been marked by uncertainty as the market seemed to pause.
If the mood in the market continues to feel unsettled it is not helped by the recent Government austerity measures. One obvious consequence of tax increases and employment cuts has been a slump in house purchases. This atmosphere of uncertainty and apprehension has fed an increasingly acute need in the public for information. People toying with the idea of buying or selling a house are keen to do their research. However, the plethora of available and conflicting indices have not served to deliver concrete answers. Additionally, Land Registry reports from Government and other sources designed to accurately represent market activity can be out of date as soon as they are published because of the time dalay in reporting. House price indices from banks such as Halifax and Nationwide reflect their business areas and cannot always give a compelte picture. Therefore, when researching the available information it’s wise to take in a variety of sources and recognise the motivation and possible bias of any particular source in order to get a more full picture.
More on Coalition Reinforcing the North-South Divide in the UK
The biggest problem facing the UK lettings market is the low level of stock. More specifically, it is a problem if you are a tenant wishing to move, but it’s also proving to be a financial blessing for landlords for a number of reasons.
If you are considering buying investment property in the UK – be warned. The latest headlines from all the major newspapers and the BBC etc, are making a great deal of the fact that average house prices in the UK rose in July by 1.7%
More on House prices rise in the UK – Much ado about nothing
According to the Telegraph, the house price correction in the UK is now over, so everyone can relax. They reference a report by the Centre for Economics and Business research which apparently states, house prices will actually “grow,” between the fourth quarter of 2009 and end-2010 and that, “there is a good chance that they will rise even more quickly, thanks to the unprecedented collapse in new homebuilding.”
Whatever the government press release farms (newspapers) might be saying, those who have tried to refinance with poor credit will know that the economic crisis is alive and well currently. The news from the UK is frankly shocking at the moment, and any suggestion of a house price recovery should be taken with a very large pinch of salt.
Asking prices for houses in the UK dropped in June, after rising consecutively in the preceding four months, a report from the property website Rightmove showed Monday. With sales volumes considerably off compared to last year, it would appear sellers are finally coming to terms with the realities of the market. The average asking price of property slipped 0.4% month-on-month in June, after rising 2.4% in May. The average asking prices declined to £226,436 from £227,441 in the preceding month. Despite the fall in June, the asking prices have increased 6% since January, Rightmove said.
The latest house price index from the British land registry shows a fall of 0.3% in April, bringing the average house price in England and Wales down to £152,898. The Land registry index is the only accurate figures available – although they lag behind the Building Society figures by a month or so, they reflect a more accurate picture because they are based on actual sales values rather than a building society’s mortgage value of an over-optimistic estate agent’s off-the-top-of-his-head valuation.
More on House prices in the UK fall for 20th consecutive month
These are a few recent headlines and predictions about when the real estate market will bottom out. Of course, there are a select few who have been calling the bottom for some time now. Oddly enough, these tend to be real estate agents and newspaper columns. Speaking of newspaper columns, we are sad to see the end of “Raising the Roof,” the erstwhile International Herald Tribune and more recently, New York Times’ very own property blog. Kevin Brass will continue to write the print edition property column for the NYT, but the online version is no more. Honestly – this was one of the few international newspaper property blogs worth reading, and I don’t think I ever once saw a “We have reached bottom, Buy Now!” headline – which may be why it has gone the way of all things? Newspaper advertising is drying up faster than the 120% mortgages did.
