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| Version 2 | Version 3 |
|---|---|
| Mortgage squeeze 'stifles' market | Mortgage squeeze 'stifles' market |
| (10 minutes later) | |
| A lack of available mortgages is "stifling" the housing market, according to the Royal Institution of Chartered Surveyors (Rics). | A lack of available mortgages is "stifling" the housing market, according to the Royal Institution of Chartered Surveyors (Rics). |
| It reported that the number of UK home sales has fallen to at least a 30-year low over the past three months. | It reported that the number of UK home sales has fallen to at least a 30-year low over the past three months. |
| The report came as figures from lenders showed that the number of loans for house purchases in the UK dropped by 15% in September compared with August. | The report came as figures from lenders showed that the number of loans for house purchases in the UK dropped by 15% in September compared with August. |
| That was 57% lower than September 2007, the Council of Mortgage Lenders said. | That was 57% lower than September 2007, the Council of Mortgage Lenders said. |
| Sales | Sales |
| Average completed sales per Rics member fell to 10.9 between August and October, the lowest level since the body first compiled the data in 1978. | Average completed sales per Rics member fell to 10.9 between August and October, the lowest level since the body first compiled the data in 1978. |
| Sales should increase in the coming months as more and more sellers understand that greater realism is the only way to make that long desired move Ian Perry, Rics class="" href="/1/hi/business/7711689.stm">UK mortgage market in graphics | |
| This affected house prices, with 84% of its members reporting that prices fell between August and October, while 14% said prices were level and 2% saw a rise. | |
| Rics spokesperson Ian Perry said last week's decision by the Bank of England to cut interest rates to 3% from 4.5% would help to boost sales. | Rics spokesperson Ian Perry said last week's decision by the Bank of England to cut interest rates to 3% from 4.5% would help to boost sales. |
| "Even so the general lack of mortgage finance remains a major blockage in the housing market for a large majority of would-be buyers," he said. | "Even so the general lack of mortgage finance remains a major blockage in the housing market for a large majority of would-be buyers," he said. |
| This was backed up by the CML figures, also released on Tuesday, that showed 35,000 loans for house purchases were granted in September, down from 41,000 the previous month. | This was backed up by the CML figures, also released on Tuesday, that showed 35,000 loans for house purchases were granted in September, down from 41,000 the previous month. |
| Recovery? | Recovery? |
| "The government should consider what other measures can be brought forward to enable the market to transact more easily," said CML director general, Michael Coogan. | "The government should consider what other measures can be brought forward to enable the market to transact more easily," said CML director general, Michael Coogan. |
| The number of home loans granted for purchases is at a new low | |
| "Banks and building societies do want to support homeowners, but they have limited funds available and are, quite reasonably, taking a prudent approach to risk. | "Banks and building societies do want to support homeowners, but they have limited funds available and are, quite reasonably, taking a prudent approach to risk. |
| "If the pricing and volume of interbank lending continues to improve, this should help the flow of mortgage lending." | "If the pricing and volume of interbank lending continues to improve, this should help the flow of mortgage lending." |
| The figures reflect the uncertainty of the time created by the banking crisis. | |
| However, the CML said that the temporary rise in the stamp duty threshold meant 51% of homebuyers avoided stamp duty in September, compared with 22% in September last year. | |
| UK housebuilder Taylor Wimpey said on Tuesday that it believed there would be no short-term recovery in the UK housing market. | UK housebuilder Taylor Wimpey said on Tuesday that it believed there would be no short-term recovery in the UK housing market. |
| The company welcomed last week's rate cut, and said it was hopeful that if it was quickly passed on to consumers it would help the market to return to stability more quickly. | The company welcomed last week's rate cut, and said it was hopeful that if it was quickly passed on to consumers it would help the market to return to stability more quickly. |
| "Increased mortgage availability and a return of customer confidence remain the key requirements for a sustained market recovery," Taylor Wimpey said. | "Increased mortgage availability and a return of customer confidence remain the key requirements for a sustained market recovery," Taylor Wimpey said. |
| Optimism | |
| Rics painted a more optimistic vision of the future. It said the worst may now be over, with 20% of its members now expecting sales to rise by the end of the year. | |
| This compares with just 4% who said in September that they saw sales rising. | |
| Rics said the growing optimism that sales would start to increase again was being driven by more sellers agreeing to drop their asking price. | |
| "Sales should increase in the coming months as more and more sellers understand that greater realism is the only way to make that long desired move," Mr Perry said. | |
| Yet it also added that the prospect of rising house sales may also reflect expectations of an increase in the number of homes being repossessed. | |
| Regional differences | |
| There were fewer than one property a week sold by each agent on average, the Rics figures show. | |
| It found that London had seen the biggest fall in sales, with members reporting an average of just 6.4 sales over the three months. | |
| Sales were strongest in the North East of England, where each member completed 16 transactions. | |
| Britain's biggest building society, the Nationwide, said on Monday that it expects house prices to continue to fall in 2009/10. |