UK Mortgages: Property Market News

UK Property Market news update

With mortgage funds in demand, mortgage product options being withdrawn by lenders and increase mortgage rates and application fees no wonder the housing market is in decline.

The recent April 2008 property house change of -1.1% is the biggest for years and is set to continue.

Homeowners are loosing the fight as UK Home Repossessions are rising and people fail to tighten their belts and continue spending..

UK House price movement

So what's to be done in order to stop or control this downward trend and who is looking out for you the home owner.
Well the Mortgage lenders must ensure they offer mortgages on affordable, yet profitable terms, without them the market will certainly crash. Far too many providers have closed their doors to new business leaving limited choice for those home buyers who do not have the funds to buy outright.

The Bank of England has pledged 50billion to help lenders to meet demand for mortgages from home buyers, but is it enough. To put this level of money in to prospective the UKs new borrowing on Buy to let property in 2007 was 50billion, Britons spent 50 billion on gambling in 2005 and Microsoft want to by Yahoo for the same amount of dollars. Well firstly the funds are to replace the existing poor credit debts for safer government bonds (a loan). This in theory should free up funds to bolster the market. No good to you or me if the banks continue to keep their doors closed.

Where will this end. Well be sure it will be a very long while before we see the markets recover fully. It is suggested that if house prices continue to tumble 1000’s of home owners will be face with negative equity for years to come, therefore possibly preventing them from moving. If a large number of homeowners are in this position the market will remain stagnant for years, with limited numbers buying, house prices will continue to fall as sellers scramble to attract the illusive buyer. Landlords won’t be around to bluster or inflate the market as BTL mortgages are too costly and lending today is mainly limited to 75% LTV.

We consider this to be a time of consolidation no reflection, to sit tight and wait it out and repent on our sins. The market will recover, it always does, the only unanswered question is ...how long it will take ...this time.