At the beginning of the week, Persimmon, one of the UK’s largest house building groups, blamed the lack of mortgage finance for the housing market remaining sluggish throughout the autumn. First time buyers have been the worst affected by this mortgage famine, the company said.
Normally the house builder would expect to see an increase in visitors and reservations during the autumn and although there was a gradual increase in weekly sales, it was nothing like the rise the company usually experienced.
Spring is the most important season for housing market activity, followed by autumn. The market generally witnesses an upturn starting in September as people return from holiday.
Despite a weaker than usual autumn, Persimmon has sold all of its properties for this year and has £460 million worth of sales already reserved for future homes. Cancellation rates are still 19% and the house builder expects an increase in sales revenues of 10% this year. 9,400 homes are due for completion this year, an increase of 5% on 2009.
Meanwhile, Property Hawk editor Chris Horne has warned that the UK’s buy to let mortgage market will not fully recover from the worldwide recession in the near future.
He said that buy to let investors looking for such products as tracker mortgages would have to wait for several years before conditions returned to normal.
However, there have been signs of improvement in the buy to let sector. Last week, the CML revealed a 12% increase in the value of buy to let lending in Q3 and it is now at a similar level to that of 8 years ago. But this is still low when compared to the average witnessed in more recent years.
© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.
