Housing market update

Property agents remain optimistic in the face of dropping house prices and a lack of house sales that shows little sign of relenting as we approach the end of the year.
Britain's foremost house-builder Taylor Wimpey has reported a 27% drop in house sales since the summer, and it's order book is 40% down compared with 12 months ago. RICS (Royal Institute od chartered Surveyors) figures for sales from estate agents shows an average of less than 11 sales per surveyor in the last three months the lowest figure ever recorded. This figure was 11.5 in September and 12.7 in August.

Note that the industry is gauged on the results of the surveyors figures - do you think that's because they cannot rely on the estate agents themselves to tell the truth??

There are several factors that are affecting the current housing market:

• Market uncertainty - where prices are perceived to be falling there is a reluctance on the part of the buyer to spend now, also a reluctance for the buyer to think about selling.
• Job uncertainty - with the recession just around the corner, most people will be thinking twice or thrice about making a financial commitment which could be jeopardised through job-losses.
• Credit uncertainty - there is no doubt that credit will become harder to obtain, with more people being turned down for mortgages, some products being withdrawn form the market and mortgage companies mercilessly jumping up the price of a mortgage with no justification.

Ultimately the slow-down in the property market will harm the mortgage houses, so it would make sense for them to make the market more attractive to new customers. It seems however that the attitude of lenders is that they will exploit the clients they can get, rather than pass on benefits of lower interest rates.

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