The Uk Housing Market

The UK housing market is traditionally one of the most vibrant in Europe with a high

percentage of home owners and many more renters looking for houses, bungalows and flats. There are vast differences in the price of housing from region to region in the UK and this is also reflected in rents. Where house prices are high, such as in the south east of England, the cost of renting is high as well.

Changing work patterns, which has seen people move from region to region in a bid to find new opportunities, have put big demands on the housing sector particularly on the market for rented properties. Even those who already own their own home may have to rent following a move to a new area until they sell their property at their former location.

Experience has shown that property prices in the UK can be very volatile. The recent economic downturn led to a slump in prices as the market dried up. However, this has happened in previous downturns, and on recovery the market often undergoes a surge in demand with a subsequent rise in property prices. However, changes in the mortgage market may limit such a rise. Whereas mortgages of 100 per cent of the cost of the property being bought were on offer before, this has now changed in the UK. This kind of mortgage has ceased to exist, with home buyers now often having to put down a sizeable deposit.

The recent downturn in house prices has accelerated the general trend that has been evident since mid-2007 when the sellers market peaked and this has been brought about not only by the problems many people, particularly the self-employed, face when trying to obtain a mortgage but also by the rise in unemployment and wages cutbacks. And, of course, falling house prices creates their own vicous circle as no-one wants to buy property in slumping market as thy don't want to face the risk of negative equity.

So, are there any signs of upturn in the UK housing market? With the current economic and political climate is seems unlikely and the disparity in house prices from the south to the north is likely to remain unaltered.

by: Avery Patterson

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