Nationwide believe the House Market will remain flat
House price growth to remain stable
Nationwide have recently received April’s figures and their chief economist has stated that for the remainder of the year he believes that prices will remain flat. We have in recent months seen small pockets of green shoots in the market, Whereby some major cities have experienced some house price growth. In London for example prices have raised a average of 6% over the past year. These are unfortunately just high demand areas and for the rest of the average UK Households prices have gradually declined over the past 4 months.
Nationwide figures for April show that the average house price now stands at £164,000 this is in fact 0.2% lower than figures released for March. The average property price has pulled back over recent months and now stands almost a percent lower than this time last year.
Also not good news for mortgage approvals they have remained very stable as well in fact they have seen a recent decline and many UK citizens are still unable to attain a mortgage. Off course we’re not expecting times to be like they where when you could attain a mortgage even if you had a awful credit, But simply the banks are unwilling to lend and are demanding very high deposits.
House Buyers may not be able to attain a mortgage
On top of this it seems likely that the government will restrict lenders from allowing house buyers to attain an Interest only mortgage. This is because there is an Interest rate mortgage time bomb, that’s starting to burst as many people who took out a mortgage 25 years ago are now coming to the end of the mortgage term and are unable to renew their policy due to their age. For example on average if you are 64 years old the bank won’t allow you to take out another mortgage. This will leave many in a situation where they are unable to sell their home.
If the government do pull interest only mortgages from the market then it will have massive implications on property prices. They may remain flat or could possibly fall due to a sudden lack of buyers.
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