New Reports Highlights Market Turbulence

by Mark Johnston

Further concerns over a second credit crunch as starting to effect confidence in the UK housing market.

A recent survey by UK property website shows that 78% of polled people expect house prices to rise by the end of 2010, that’s down 81% when the poll was last carried out 3 months is one of the most comprehensive property websites that provides a property listings, market data and local information.A quarter of those surveyed thought that a shortage of mortgages was the main threat to the UK market. This is due to growing fears that credit may dry up again as wholesale borrowing costs remain high and government schemes as set to end. A further quarter of people polled thought that it was harder to get a mortgage than three months ago. Although these polls are concerning, they have to be given a balanced view. Many borrowers would only be looking for one mortgage so it would be hard for them to comment on how difficult it was to find a mortgage from one month to the next.The recent cost cutting plan set out in the budget which is putting many public sector jobs under threat may also be impacting buyer confidence. Potential rises to the Bank of England base rate is also effecting many from purchasing their first home or moving to a new property.Zoopla’s commercial director, Nicholas Leeming, said “The fear remains that the revival in the housing market will be derailed unless the banks make a concerted effort to increase lending.”He went on to say that “With job cuts looming in the public sector and interest rate hikes expected at some point, the new government has its work cut out for it to ensure that home ownership remains affordable and attainable for most people.”In contrast, the estate agent group Connells is painting a more positive picture. A recent report published by Connells shows a large increase in seller confidence in June which may be as a result of the coalition Governments abolishment of the Home Information Pack.There was also a strong rise in the number of valuations for buy to let mortgages. Buy to let mortgages are usually used for investors who are looking to buy an additional property that can then be used to generate rental income. The number of private rentals available in the UK is low at the moment and rents are on the increase. Many are seeing this as a great time to get onto the property market for investment and are taking out buy to let mortgages. Valuations are up by 10% in June when compare to the previous month and overall up by 12% when looking on an annual basis.

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