Over the past week there has been a number of articles highlighting the weakness of the property market and how grim the prospects are for house prices in the UK. The most recent one had the headline ‘UK Housing Market Could Crash Harder Than US’ which appeared in the Wall Street Journal. I disagree with this view and see this as another example of a lack of understanding of the UK property market. There is a shortgage of housing in the UK and this in itself means you cannot compare the 2 markets.
Almost contradicting this view was the recent headline showing that mortgage product availability is at a 3 year high. Figures from Mortgage Brain show that over 2,000 new products were introduced during May representing a 2% increase in product availability. With increases in all 3 main product types there are now almost 4,500 more products available to UK mortgage intermediaries than 6 months ago. This represents a 60% uplift in overall product availability. Encouraging signs can also be seen for home buyers with a 20% deposit or less with the latest status showing that the number of products with the LTD rate of 80% or more has increased by 35% over the past 6 months.
Blackadders monitor the property market throughout Scotland and I can report that my Firm had a very good month for listings i.e. new houses coming on the market in May – May was also our best month for property sales in 2 years. As readers of my predictions for 2011 will know this surge is 2 months earlier than I expected. The Blackadders’ figures for May indicate to me the underlying strength of the Dundee property market in particular and the increasing confidence amongst purchasers throughout Scotland . If we could just get more assistance for first time buyers then I think that May will be the start of the property market coming to life.
I will continue to keep you advised of trends over the next few months.
ps Since dictating this blog I am pleased to report that June’s figures are continuing the positive trend – fingers crossed. In relation to first time buyers I have heard on the grapevine that the Scottish Government may shortly announce a plan – originally promoted by me a couple of years ago – involving the Government guaranteeing part of the mortgage. This scheme would be open to ftb’s and key workers and would allow lenders to increase loan to value percentage available. A brilliant initiative that should be applauded if it comes off and one which will further help the Scottish property market.
Head of Property Services