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UK House prices on the rise
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John Preest
Whole of market right to buy mortgage for the UK. contact us for the latest remortgages 
By John Preest
Published on 02/6/2009
 
At last some good news for the UK housing market, this months house price index released by the Halifax has shown that property on average has risen by over £3,000 in one month, this bucking the trend of the last year.

UK House prices on the rise

 

The surprise rise of 1.9% goes against the 10 consecutive monthly falls of UK house prices, these falls have knocked off the best part of £35,000 from the average house price. This news will be welcome relief for the millions of home owners who have been worried that their property will fall into negative equity.

 

With the Bank of England reducing interest rates to 1% the lowest in the banks 400 year history, home owners are also benefiting from much lower mortgage payments. These cuts along with the stabilising of the housing market will be a good thing for the U K as a whole. However Martin Ellis, chief economist at the Halifax, has warned that this could be a statistical blip and one months data should not be taken as a given that house prices have stopped falling.

The average price of a house in the UK now stands at £164,000, down from an eye watering £200,000 at the peak of the market back in 2007. With the uncertainty of jobs, it is unlikely we will see house prices bucking the trend.

With UK interest rates now at the lowest homeowners are benefiting from mortgage payment of more than half, but will this help in saving the housing market, we will have to see. Although homeowners are benefiting from lower mortgage payments, FTB’s are still being restricted from access to mortgage finance. Back in 2007 there where numerous lenders offering mortgages of a 100% and more, but with the credit crunch mortgages for the FTB have all but dried up. The people looking to purchase their first home now need a deposit of 10% or more with the best deals requiring 75%.

The other mains stay supporting the housing market over the last 5 years have been but to letinvestors and they have been fairly thin on the ground in recent times as few mortgage companies are offering BTL mortgages and those that do are looking for 25% deposit.

So with first time buyers and buy to let investors being restricted from obtaining mortgages it looks like the UK housing market has further to fall, 2009 will be a difficult year for everyone involved in the financial and property market and the green shoots of recovery not far away. We will have to wait to see if next months figures are just a s good or this months where just the statistical blip that they look like.