Slow Home Sales in UK Said Due to Lack of Mortgages

Typically, during the Autumn months, the United Kingdom’s housing market tends to see something of an upswing, but that is not the case in 2010, say house building groups across the nation. Instead, due to a lack of mortgage finance, first time buyers are being left completely out of the loops when it comes to being eligible to purchase a new home.

This comes as no surprise to consumer finance experts who say that with so many people in debt now, it is nigh to impossible for them to even consider taking on more debt. Those struggling are still being advised to pursue Debt Management Plans if their debt is small since most advocates view this part of the recession as the lower mid point of the cycle, meaning that those who take care of their debts now will be in a good position once the lending and housing markets bounce back.

Leading builder Persimmon says that the sales levels for September did rise each week, but the typical Autumn jump was nowhere to be seen. Even the amount of consumers merely looking was down sharply from a year before.

In terms of the British housing market, Autumn is the 2nd most important season with Spring being the clear leader, traditionally speaking. Summer being the time to take a holiday, the market generally surges again in September. This is making builders nervous as they fear that the housing market is is definitely starting to head back down further than before.

House prices, too, are looking as if they will experience a very steady decline, according to estate agents. Even Halifax and Nationwide, mortgage lenders, have seen released data that shows falling prices across the UK. Despite the lower prices, however, the availability of mortgages remains scarce. Consumers face large deposits and this means that with such poor terms, first time buyers are practically locked out of the market which, in turn, strikes directly at the profits of builder. Redrow even termed the current situation a ‘mortgage famine’ and has complained that it is not a good way to help the economy rebound.

While the market looks bleak for buyers, the industry itself is managing to handle its own debts with builders like Persimmon restructuring their operations to adjust to current economic realities in Britain.