Latest Property News around Barry, Cardiff, Bridgend

The Royal Institute of Chartered Surveyors (RICS) is predicting that more would-be buyers could turn to the rental market due to a slowdown in the housing market plus a combination of factors.

Last month 14.6 per cent more chartered surveyors reported a fall rather than a rise in property prices, compared to a figure of just 3.3 per cent in August.
RICS believes anyone looking to get cash for property may want to do so sooner rather than later in case prices fall further.

There was also a downturn in the number of new buyers entering the market and the institute says this is due to the combination of rising interest rates, the introduction of HIPSs and volatility in the financial markets resulting in tightening of lending criteria.

Gross mortgage lending fell by nearly 12 percent in September compared with August, to an estimated £30 billion according to new data from the Council of Mortgage Lenders (CML).

Although lending was up 2.5 percent on the £29.2 billion figure for September 2006, the annual increase is the lowest percentage increase in two years. The figures are not seasonally adjusted.

While lending typically falls between August and September, a 12 percent decline is larger than the norm of around five percent. This easing in the market is another sign of the expected consumer response to the five interest rate rises experienced since August 2006.

CML director General Michael Coogan said: “We have been expecting a slowdown in monthly lending levels in line with interest rate rises. In the coming months, we expect to see monthly lending levels dip below their 2006 levels for the first time this year as rate effects are exacerbated by the recent liquidity problems in the mortgage market.”

Commenting on the mortgage lending data, Simon Rubinsohn, RICS chief economist, said: "The gradual slowdown in housing market activity continues unabated.

“ Mortgage lending remains higher than the same period last year, yet recent months have seen a marked slowdown in lending volumes in response to the previous interest rate hikes, stretched affordability and the impact of the Northern Rock episode.

“ RICS expects activity to slow further into the New Year. 2008 will see a subdued market and little or no change in house prices."