Due to the current economic climate, in recent months, the UK housing market has been in dramatic decline. A staggering 16.6% decline has been seen, to date with a total of 1.3% of that amassed during January 2009.
There are many articles online which give you an idea about the future of the UKs economy. It seems unlikely that any improvement will be seen for some time to come, if anything the condition of the housing market looks set to decline further still.
It has been predicted, by the Royal Institution of Chartered Surveyors (RICS) that there will be a further 10% decrease in the number of houses sold, this year. The housing market is currently in the worst position seen in many, many years.
RICS have reported that house prices will plummet a further 10% and sales of homes will not pick up again until 2011, therefore people will have to accept that their homes are now worth less than they were a few years ago if they are going to move on.
As the current UK housing market has been weakened somewhat there are good deals available to first time buyers and people looking to invest in property alike. Many houses are being repossessed and resold at a cheaper rate. It is therefore a good time to buy, although not such a good time to sell houses within the UK.
During the rest of 2009 it is expected that a further 34,000 homes will be repossessed. Housing repossession is currently at an all time high, this owing mainly to the current economic climate. People are finding it ever more difficult to keep up with their mortgage and rent repayments.
So what are the main reasons why we have seen such a big decrease in the value of properties in the current UK property market?
(1) Mortgage companies are far less willing to provide finance to those people who want to purchase a home. This is because many people are unsure whether they will have a job or not and whether repayments for these mortgages can be met.
(2) Mortgage lenders are demanding a higher down payment from first time buyers, doing this makes it difficult for the buyer as normally they do not have the money.
(3) People are expecting house prices to fall further, they are unwilling to buy.
(4) Although cuts in the banks base rates have helped to reduce how much peoples mortgages cost, this wont actually help to stop the prices of houses falling further. Even with these cuts, the average cost of a mortgage has not altered that much because 2 or 3 years ago people were remortgaging due to great deals being offered. What many of us do not realise is that over time the banks have been increasing their profit margins.
These are challenging times not just for property buyers, but also for builders and estate agents. A lot of these jobs are going because of the down fall, making the UK economy even worse.
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