A recent report has shown that the December 2010 mortgage lending was at its lowest level since 2000 and 18% lower than December 2009. The latest Home Track Survey of over 5000 Agents shows a slowdown in both supply (new houses coming onto the market) and demand. I have to concur with these two views and would advise that the Scottish wide analysis that we carry out on the property market in Scotland certainly shows that, with a few geographical exceptions, supply and demand are lower than 2010 levels and are very close to the low point of the market in 2009.
Whilst these figures are only our initial analysis and January has ended with a definite increase in activity, there is no doubting the trend. I am not concerned in relation to house prices, as these remain relatively stable but I am concerned about a stagnating property market. With people taking the view that there is nothing to buy or that they would not be able to sell their house, they are apprehensive about putting their property on the market. This then becomes a self-fulfilling prophecy and has serious implications not just for the housing market but for the economy as a whole. I was interested to read an article by Tom Vosa who is the Head of Market Economics for Clydesdale Bank who states that a sustained economic recovery will only come with a housing market stabilisation.
I would reiterate my call to UK and Scottish Governments to do more to assist the housing market. The Scottish Government should scrap the Home Report with immediate effect and the UK Government should implement a programme of assistance for the housing market and in particular first time buyers.
To assist the housing market, Blackadders has, for the month of February, launched a guaranteed sale scheme which, subject to terms and conditions and availability, means that if we do not manage to sell a property within 12 weeks then there will be no estate agency fee payable. My hope is that this will encourage people to take the plunge and get their house on the market and get the housing market moving again.
PS – I am delighted to announce that since writing this blog the Housing Minister Grant Schapps has organised a summit with mortgage lenders, industrial leaders and house builders to discuss the first time buyer mortgage crisis. This will take place on the 15th of February and I will issue a blog shortly thereafter with an update.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.