The number of people putting their home up for sale dropped last month, as the housing market continued to be affected by economic turmoil.
The UK Housing Market survey from the Royal Institution of Chartered Surveyors found that the number of new instructions dropped back during September and surveyors said that people are now thinking twice before selling their property.
Although enquiries from new contractor mortgage buyers did increase slightly, the large deposits demanded by lenders are still a barrier for first time buyers.
Surveyors reported a marginal increase in the amount of stock on their books in September and a fractional increase in the amount of sales per surveyor in the three months to August.
Realistically priced properties are still selling but 23% more surveyors reported that house prices were falling rather than rising. The same percentage expects prices to continue to drop for the remainder of 2011.
Although there was an increase in interest from first time buyers, another survey this time from e.surv showed the number of first timers who actually bought a property fell to its lowest level for almost 12 months.
Only 22% of the mortgages approved last month were for properties in the first time buyer bracket i.e. up to £250,000. That’s the lowest percentage since November last year and a long way down on the 30% we saw in 2006.
33.5% of all approved mortgages last month were for buyers with 25% or less deposit, compared to 43.2% in September 2007. First time buyers still need to find large deposits with the average LTV in the first time buyer bracket standing at 66%.
Total mortgage approvals dropped 1.7% last month from 52,410 to 51,524.
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