House prices fell by 1.8% in February as sharp interest rate cuts and improved affordability failed to restore market confidence, the UK's biggest building society said today.
According to Nationwide's latest snapshot of the housing market, the average price of a UK home has fallen by 17.6% over the past 12 months, dropping by more than £31,000 to £147,746. Prices are now 20% down on their October 2007 peak of £186,044.
The society said that despite swingeing interest rate cuts, which have brought the Bank of England base rate down to 1%, its lowest ever level, would-be buyers were still holding back.
Nationwide's chief economist, Fionnuala Earley, said: "Early signs of increased interest in housing, as reported by the pick-up in new buyer enquiries, have yet to filter into sales, but do suggest that falling prices and interest rates are raising curiosity now, which could flow through quickly once confidence returns."
However, she added: "Further cuts in rates will be welcome in the housing market, but the economic conditions that require them will mean that there is unlikely to be a swift turnaround in the housing market in 2009."
Figures published this week by the British Bankers' Association showed an upturn in the number of mortgages approved for house purchases in January, and estate agents have been reporting an increase in interest from potential buyers.
Some will have been encouraged by recent price falls and falling interest rates, which have made homes much more affordable for first-time buyers. However, mortgages remain hard to come by and lenders are still offering their best deals to those with large deposits
Thursday, February 26, 2009
Wednesday, February 25, 2009
Low end property owners reap the benefits
HOMEOWNERS whose properties are worth less than $500,000 are reaping the greatest rewards of government grants and low interest rates.
Economists say prices will rise by 5 or 6 per cent in Sydney suburbs where the median house price is below half-a-million dollars thanks to demand by first-time buyers.
Auction volumes picked up yesterday as the market swings into gear for the year after a lacklustre end to 2008 when Sydney property prices slipped more than 4 per cent. Weekly clearance rates in the past fortnight reached a peak of 70.8 per cent but the number of properties auctioned was low.
Agents say the most activity is among first-home buyers who are taking advantage of state and federal grants worth up to $24,000.
On Friday, Reserve Bank Governor Glenn Stevens flagged further rate cuts and said the effect of successive falls in the cash rate were only beginning to have an impact.
He said he expected a recovery in the housing market to begin later this year.
Australian Property prices monitors' senior economist Liam O'Hara said the upper end of the market would continue to fall or remain flat while the interest rate cuts would further boost activity at the bottom end.
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Economists say prices will rise by 5 or 6 per cent in Sydney suburbs where the median house price is below half-a-million dollars thanks to demand by first-time buyers.
Auction volumes picked up yesterday as the market swings into gear for the year after a lacklustre end to 2008 when Sydney property prices slipped more than 4 per cent. Weekly clearance rates in the past fortnight reached a peak of 70.8 per cent but the number of properties auctioned was low.
Agents say the most activity is among first-home buyers who are taking advantage of state and federal grants worth up to $24,000.
On Friday, Reserve Bank Governor Glenn Stevens flagged further rate cuts and said the effect of successive falls in the cash rate were only beginning to have an impact.
He said he expected a recovery in the housing market to begin later this year.
Australian Property prices monitors' senior economist Liam O'Hara said the upper end of the market would continue to fall or remain flat while the interest rate cuts would further boost activity at the bottom end.
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Tuesday, February 24, 2009
Mortgage approvals fall 43 percent year over year in January
Reuters - The number of mortgages approved for house purchase picked up slightly in January from December but remained more than 43 percent lower than a year ago, the British Bankers' Association said on Tuesday.
The BBA said mortgage approvals totalled 23,376 last month. That compared with 22,416 in December and a record low of 17,574 in November.
Total mortgage lending was 2.9 billion pounds in January, down from 3.3 billion in December.
The report highlights the continued downward pressure on British house prices which have fallen around 17 percent in a year as the credit crunch has made it harder and more expensive to get finance.
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Reuters - The number of mortgages approved for house purchase picked up slightly in January from December but remained more than 43 percent lower than a year ago, the British Bankers' Association said on Tuesday.
The BBA said mortgage approvals totalled 23,376 last month. That compared with 22,416 in December and a record low of 17,574 in November.
Total mortgage lending was 2.9 billion pounds in January, down from 3.3 billion in December.
The report highlights the continued downward pressure on British house prices which have fallen around 17 percent in a year as the credit crunch has made it harder and more expensive to get finance.
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Thursday, February 19, 2009
One in five subprime borrowers struggling with mortgage repayments
Mortgages Update
Five per cent – or around 37,000 borrowers – expect to have their homes repossessed within the next six months, while over a third of respondents or 260,000 householders said they would be unable to fully meet mortgage payments if their income fell significantly.
If their fears of repossession were borne out, it would represent a sharp rise in the rate of repossessions since last year.
The Council of Mortgage Lenders is expected to announce on Friday that a total of 45,000 homes were taken back by lenders last year. But 37,000 being repossessed in six months is equivalent to an annual rate of 74,000, and Shelter's survey covered only subprime borrowers.
"We believe the situation will get far worse, with thousands of subprime borrowers looking for new mortgage deals when their fixed-rate ends later this year," said Shelter.
"With subprime standard variable rates at 10.5pc and fixed rates of 9.5pc, thousands could be hit with a huge monthly payment shock. There are also only five subprime lenders in the market, compared with 22 a year ago."
If these borrowers have to pay more each month on a new mortgage deal, their finances will be stretched further, potentially bringing about repossession.
Shelter found that 22pc of respondents, or around 160,000 households, admitted to struggling or falling behind with their monthly mortgage payments. Sub-prime borrowers were taking drastic measures to pay their mortgage, including borrowing from friends and family, using credit cards and taking out loans, the charity added.
Adam Sampson, Shelter's chief executive, described the figures as "terrifying". He added: "Home owners who borrowed in good faith during the boom now finding themselves among the most vulnerable to repossession.
"Now for the first time we can reveal the true extent of the credit crunch and the destruction sub prime is yet to have on the housing market."
Full story visit www.telegraph.co.uk
Pounds to US Dollars = 1.4385
Pounds to Euros = 1.1315
Euro to Pounds = 0.8823
Pounds to Australian Dollars = 2.2170
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Five per cent – or around 37,000 borrowers – expect to have their homes repossessed within the next six months, while over a third of respondents or 260,000 householders said they would be unable to fully meet mortgage payments if their income fell significantly.
If their fears of repossession were borne out, it would represent a sharp rise in the rate of repossessions since last year.
The Council of Mortgage Lenders is expected to announce on Friday that a total of 45,000 homes were taken back by lenders last year. But 37,000 being repossessed in six months is equivalent to an annual rate of 74,000, and Shelter's survey covered only subprime borrowers.
"We believe the situation will get far worse, with thousands of subprime borrowers looking for new mortgage deals when their fixed-rate ends later this year," said Shelter.
"With subprime standard variable rates at 10.5pc and fixed rates of 9.5pc, thousands could be hit with a huge monthly payment shock. There are also only five subprime lenders in the market, compared with 22 a year ago."
If these borrowers have to pay more each month on a new mortgage deal, their finances will be stretched further, potentially bringing about repossession.
Shelter found that 22pc of respondents, or around 160,000 households, admitted to struggling or falling behind with their monthly mortgage payments. Sub-prime borrowers were taking drastic measures to pay their mortgage, including borrowing from friends and family, using credit cards and taking out loans, the charity added.
Adam Sampson, Shelter's chief executive, described the figures as "terrifying". He added: "Home owners who borrowed in good faith during the boom now finding themselves among the most vulnerable to repossession.
"Now for the first time we can reveal the true extent of the credit crunch and the destruction sub prime is yet to have on the housing market."
Full story visit www.telegraph.co.uk
Pounds to US Dollars = 1.4385
Pounds to Euros = 1.1315
Euro to Pounds = 0.8823
Pounds to Australian Dollars = 2.2170
Bye For Now
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Contact IMS Foreign Exchange + 44 207 183 2790
Friday, February 13, 2009
US dollar exchange rate is on the defensive
Foreign Exchange Outlook : US dollar exchange rate is on the defensive
The US dollar exchange rate is on the defensive and may suffer more position-paring today as risk aversion fell back on the prospect of a housing market rescue initiative from the Obama administration that pushed stocks into a late-day rally. The G7 meeting starts today with a high probability of some shocking statements from finance ministers and other officials, although the actual communiqué tomorrow is not expected to contain anything new.
Pounds to US Dollars = 1.4400
Pounds to Euros = 1.1174
Euro to Pounds = 0.8947
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Barbara Rockefeller
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The US dollar exchange rate is on the defensive and may suffer more position-paring today as risk aversion fell back on the prospect of a housing market rescue initiative from the Obama administration that pushed stocks into a late-day rally. The G7 meeting starts today with a high probability of some shocking statements from finance ministers and other officials, although the actual communiqué tomorrow is not expected to contain anything new.
Pounds to US Dollars = 1.4400
Pounds to Euros = 1.1174
Euro to Pounds = 0.8947
Bye For Now
Barbara Rockefeller
Foreign Exchange Trading
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Buying Euros? Buy Euros at the best euro Rates!
Buying Dollars? Buy US Dollars at the Best Dollar Rates!
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Contact IMS Foreign Exchange + 44 207 183 2790
Thursday, February 12, 2009
Foreign Exchange Outlook - Euro Exchange Rate falling again
Foreign Exchage Outlook
The dollar is resuming its uptrend across the board as the US Treasury refunding is going really well and dreadful economic news continues to come out of the woodwork in Europe. The market remains skeptical about the Geithner plan, especially in Japan, but the US may be taking the
lead on regulatory and financial sector restructuring at the G7 summit that starts tomorrow.
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Barbara Rockefeller
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The dollar is resuming its uptrend across the board as the US Treasury refunding is going really well and dreadful economic news continues to come out of the woodwork in Europe. The market remains skeptical about the Geithner plan, especially in Japan, but the US may be taking the
lead on regulatory and financial sector restructuring at the G7 summit that starts tomorrow.
Bye For Now
Barbara Rockefeller
Foreign Exchange Trading
Forex Trading Reports - Click for a free trial
Buying Euros? Buy Euros at the best euro Rates!
Buying Dollars? Buy US Dollars at the Best Dollar Rates!
Buying Australian Dollars? Buy Australian Dollars at the Best Australian Dollar Rates!
Contact IMS Foreign Exchange + 44 207 183 2790
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