16 February 2008

Comment on house prices in Britain 2008

British house prices have fallen more than ever before in the three months to January for the last 10 years. This is a clear sign the interest rate cut did little to stabilise the property market.

The monthly house prices balance dropped for the sixth consecutive month, according to the Royal Institute of Chartered Surveyors. The analysts' forecasts showed a less severe deterioration.

The weakening demand rather than increased supply have caused the drop. Also more properties are now available to sell then before in agents books. The housing market in Britain seems to set for a slowdown this year after several years of strong growth.

Conditions, of course, might stabilise. To do that however mortgage lenders have to reduce their rates and unemployment should not start rising.
If the recent job loss in the finance industry continues and spread into other sectors there is a good chance for that. However recent job losses did not greatly affect bonuses, so there is small chance that any further drop, if any, will take a lot more to intensify.

Nearing time to buy or to save some more and wait?

No comments:

Post a Comment