Buyer interest increases and house price falls slow
Recently released figures for the month of April have shown that whilst interest from buyers in the housing market increase the pace of house price falls slowed down.
The level of house price falls were at their slowest in more than a year for April, and with interest rates at an all time low and house prices down by over 20 percent from their peak, a rising number of potential buyers have been returning to the market and showing signs of interest. However, despite this encouraging news industry officials said that mortgages were still sliding.
During the month of April only 32 percent of postcode districts reported house price falls, and this compared with 59 percent for the month of February.
The average cost of a home in England and Wales fell by 0.3 percent for that month, according to the figures. However, whilst this has fuelled speculation about a recovery in the housing market officials were quick to point out that despite increased interest from would be buyers the level of mortgage approvals had still been falling.
One official that was involved in the research said: ‘While the pick up in demand and sales volumes is real, it is important not to lose sight of the broader picture. The volume of housing sales is set to be less than half the level that would constitute normal market conditions. In the rush to seek out the green shoots of recovery, the importance of first-time buyers in driving the market is often underestimated, and the fact remains that the majority remain affordability constrained and unable to access mortgage finance.’
Another mortgage expert added: ‘Although some highly competitive products have entered the mortgage market in the last couple of weeks, and there has been a definite rise in enquiry levels, lenders generally are still being very cautious and this caution is reflected in the latest BBA mortgage lending figures. The time is ripe for people to start looking for property again to take advantage of low house prices and mortgage rates, but unless you have a substantial deposit this is still proving very difficult.’
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