Are house prices falling?
The Royal Institution of Charted Surveyors have reported a fall in house prices. According to the RIC, house prices fell in September and more of their members reported a fall locally than an increase.
It was also reported that there was a fall in first-time buyers for the 10th month in a row. The combination of higher interest rates and tightening on lending criteria are two major factors that have contributed to the downward spiral in first-time buyers being able to afford the jump from renting to home owner.
It is seemed unlikely that whilst economic growth and income is above the average, that we will experience a change in the housing market.
It is a daunting time that certainly is affecting the confidence of first-time buyers and sellers for that matter. The Council of Mortgage Lenders feels that the sheer burden of repaying the interest on mortgages for first-time buyers is the worst in 16 years, with a similar problem affecting people moving house. The CML foresees that this will only get worse in the forthcoming months.
Lenders have to cover the cost for the risk they are taking on and so mortgages are only going to become more and more expensive for customers who have poorer credit histories.
