The Nationwide building society has said, ‘property price rise in the United Kingdom began to ease off in July’. Its new monthly survey reveals that the prices fell by 0.5 percent this month, taking the yearly rate of home price inflation down from 8.7 percent to 6.6 percent. The cost of the average home rate is about 169,347, which is nearly the same like it was in July, 2008. Figures from the Bank of England showed, that the in the meantime, mortgage market was also remained subdued in June.
Mortgage restrictions
The Nationwide said that the price increases were easing off since more properties or houses were being put up for trade.
Martin Gahbauer, the society’s chief economist said ‘At the present time, the market is evidently easing relative to the very less supply conditions which characterized it since early 2009. A combination of the uncertainty about the future economic viewpoint and restrictive credit conditions continues to limit the pool of purchasers to those with comparatively huge economic resources.
Purchasers usually still have to make a deposit of at least twenty five percent in order to secure a mortgage as building societies and banks started to ration their mortgage lending in the wake of the banking crisis and credit crunch of 2007 and 2008.
The Nationwide said that the number of the finished houses sales was still going at nearly half the level made a note before the banking crisis and credit crunch began. Since the spring of the year 2009 prices had been increased higher again, largely by a shortage of properties coming onto the real estate market for sale. But, the Nationwide said it was uncertain about where values or prices were heading.
Martin Gahbauer said, ‘it would take many more months in order to establish whether home prices are now just moving around a period of downward trending prices or a flat price trend may be in store’.