Home Buyer Activity Picking Up Across UK

House For Sale By OwnerHome buyer activity is increasing fastest in parts of the UK where prices have been the most depressed, an industry survey says.

The Royal Institution of Chartered Surveyors (Rics) said that buyers were now returning to the market in their biggest numbers for four years.

The largest rise in activity came in the West Midlands and the North East.

Overall, Rics said prices rose faster in July than at any time since the housing market peak in November 2006.

Every region saw prices rise, Rics said, although London and the areas around it continued to see the biggest price increases.

Revival spreads

Rics said that both the West Midlands and north-east England had seen their highest levels of interest amongst buyers for 14 years.

For the West Midlands it was the highest level since the figures were first collected, in April 1999.

Property For Sale In CambridgeshireWales also saw a surge in demand, as measured by the number of people registering with estate agents, and Scotland too saw an increase.

“Growth in buyer numbers and prices have been happening in some parts of the country since the beginning of the year,” said Peter Bolton King, from Rics.

“But this is the first time that everywhere has experienced some improvement.”

Scotland, Wales and north-east England saw some of the largest house price falls during the recession.

When asked about values, more surveyors in the North East said prices were rising than surveyors who thought prices were falling.

That is the first time that a majority of surveyors in the region have taken that view since January 2012.

Surveyors in Scotland were more positive on prices than in any other area outside London and the South East.

Cheaper loans

Government help for the housing market is one reason for the pick-up in activity, said Rics.

The Help to Buy scheme, which began in April 2013, allows buyers of new-build homes to put down a 5% deposit, and take out a government loan for up to 20% of the value of the property.

From January next year, it will be extended to help buyers of existing homes, and the government will guarantee a proportion of the loan to give the banks greater confidence to lend.

But Rics said that the Funding for Lending (FLS) scheme – where banks can borrow money cheaply from the Bank of England, providing they lend it on to businesses or individuals – has had a particular effect on improving mortgage availability.

It said FLS had improved so-called loan-to-value ratios, or the amount that banks and building societies are prepared to lend on any property.

On average, loans are now 83.6% of the value of a property, compared with 81.6% a year ago

Mortgage rates have also fallen, making repayments cheaper.

Last week’s announcement by the Bank that interest rates are likely to remain at their record low for several years to come, is also likely to improve the number of cheaper mortgages on offer.

Courtesy of BBC News

Published: 13/08/2013

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