Despite the 1.7% fall in the value of the average house in July there are a few positives contained in the Nationwide report. Fionnuala Earley , their chief economist points to encouraging signs within the swap market where rates have fallen allowing for fixed mortgage rates to come down recently. Lenders had previously expected the MPC to put interest rates up two more times this year, whereas now the view is that they will not increase at all.
Talking about forced sales Ms Earley says that " estate agents are reporting up to 40% of transactions falling through and the average number of sales per surveyor is at its lowest ever level. This could be partly due to the availability of finance but the Bank of England Agent's report suggests that this may also be due to the reluctance of sellers to accept low offers. While this does little for liquidity in the housing market, it does indicate that sellers are largely not in a position where they are forced to sell"
Other key points from the report include:
- First time buyers are down 41% from this time last year
- 22% of lenders expect less credit to be available in the next three months
- Average house price 8.1% lower than a year ago
- Average house prices almost £11,000 HIGHER than three years ago.
