proved to be the busiest for the housing market for quite some time, with
regard to both sales and lets. In fact, the buy-to-let market continues to go
from strength to strength and mortgages for the sector are at a 4-year high.
Add to that
the rise in prices, particularly in London, and the government’s Help to Buy
scheme boosting new property sales and it’s probably one of the best times to
be an estate agent in recent memory.
critics make noises about the new housing bubble and predict gloom, this
doesn’t seem to be happening anytime soon. In fact, looking at the previous “pre-crash”
boom it seems that the current rise in activity in the housing market isn’t
even close to the level it was back then. Whilst prices are rising, this remains at less
than 5% per year, according to the Halifax and Nationwide.
media reports predicting that it will all end in tears, at the moment the
economic and housing market recovery looks strong. Repossessions are at a six year low and
mortgage arrears are lower than they have been since 2008. And we’ve seen the
return of first time buyers who accounted for more than half of all house purchase loans taken out in
London in the second quarter of this year, recent data from CML has revealed.
It is now
crucial that the supply of property improves so that the goal of a significant
increase in transaction numbers is not overshadowed by an unsustainable boom in
Providing assistance with the purchase of housing
artificially props prices up. We have witnessed this twice before. When it became easier to borrow money during
the 1980s house prices rose. Even after
the 1990s downturn the market just kept finding ways to lend people more money,
allowing prices to rise again. For prices to stabilise there needs to be a
significant increase in the supply of housing for sale and rent.
As Professor John
Kay recently commented in the Telegraph,
government policies should focus more on increasing the supply of housing,
rather than “encourage people to bid up the price of existing stock”.
House prices are currently around 12% higher than the lows
seen in the midst of the financial crisis, though they are still around 10% below
the all-time highs recorded in late 2007. London has been affected by external factors like overseas interest and
wealthy individuals in the Eurozone looking to protect their money. Consequently there is a lot of foreign money
in London that is not in the rest of the country and this is boosting prices.
You may be interested to know that prices in Ealing have soared
by more than 14% over the past year and are now at a record high! To
book a free, no obligation valuation showing what your property is worth
today call us now on 020 8740
6622 or e-mail us at [email protected]