Is this the start of the recovery for the housing market?
6th August 2009
House prices have shown their first quarterly rise since October 2007, according to the UK’s largest mortgage lender. The Halifax house price index shows prices from May to July were 0.8% higher than in the previous three months. So far this year, the Halifax index states house prices have fallen by less than 1%. Are these tentative signs of recovery for those thinking of moving?
More figures extended the positive trend, after building society Nationwide reported that the average value of a UK home rose by 1.3% in July. The number of mortgages approved for house purchases has also risen for five months in a row to the highest level for more than a year. Has lending policy finally relaxed enough to allow the financing for that delayed move?
As well as strong housing demand, the market has been supported by a record low Bank of England base rate of 0.5%. This has today remained unchanged by the Bank's monetary policy committee for the fifth consecutive month. Low rates for the proposed move as well? Sounds too good to be true after a gloomy 18 months.
Cautious optimism seems to be more appropriate than celebration. Taj Kang, Associate Director at Mortgages Made Easy, offers the following advice to anyone who has delayed their move while they adopt a “wait and see” approach.
“The property slump may be at its lowest ebb, interest rates are low if you have the right level of deposit, and many rival purchasers are struggling to raise mortgage finance and deposit funds. For many who have been waiting for market conditions to improve, now may be the ideal time to buy a new home. Once it becomes common knowledge amongst sellers that property prices are increasing, it may be much harder to secure a property at a ‘reasonable’ price.”
Taj Kang
Associate Director
Mortgages Made Easy