As the housing sector stumbles into 2011, some experts believe that the time homes stay on the market will at long last start to come down.
The news that house prices had once again started to fall at the back end of 2010 caused dismay in millions of homes across the UK. Homeowners who had been relieved to see house prices start to edge upwards in the spring of 2010 were once more looking at the possibility of being in negative equity. For many in the industry it came as no shock at all.
There are many reasons why house prices should not go up just yet. The austerity measures imposed by the Government mean we shall all be worse off in the near future. The threat of unemployment because of the aforementioned policy will almost certainly cause many couples to postpone plans to move house and the sheer weight of numbers of homes on the market means that the law of supply and demand favours the buyer. Lastly but not leastly we have the high deposit and crippling interest rates demanded by the banks and building societies to new customers.
So why should some experts believe the amount of time a house stays on the market will start to come down in 2011? The simple answer is that people at long last have grasped that changing lenders, in most cases, will lead to an increase in their mortgage rates.
In the past 18 months thousands of homeowners have accepted offers from interested parties only to find that seven days later the offer had been withdrawn. In nearly all cases the prospective buyers had discovered that the rather nice interest rates that they were on with their old mortgage would not be available when they took out a new mortgage on a new property. Instead of paying something in the region of 4% they were being asked to pay around 6.5%. Not surprisingly the overwhelming majority said no thank you to the banks and no thank you to the frustrated homeowners looking to move on.
The market was left to those with big deposits and deep pockets and for some landlords the chance to increase their portfolios and get cheap landlord insurance on bargain properties was very inviting.
Estate agents believe that the public in general are now wise to the fact that changing mortgage is not feasible unless your economic situation is good. They are now beginning to see offers on properties going full course and expect the situation to improve as the current year progresses.