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The housing market is year from picking up |
| Date Added: July 15, 2011 09:13:42 PM |
| Author: kAlvertaSavagek |
| Category: Finance and Investment: Mortgages |
| The housing market is year from picking up and is entering a period of stagnation, according to experts. The prediction from Pricewaterhouse Coopers, the accountants, said house prices might not recover for a decade. It said that those who took out mortgages and bought homes between 2006 and 2008 would suffer the most. The report said that there is a “near 50 per cent chance” that prices will still be in recovery. House prices peaked in 2007 the average price of a property was a touch under £200,000. The same property now is worth £160,000 – a 20 per cent drop. This is reflected in the wider mortgage and remortgage market that has seen a similar downturn. However, where the housing market is predicted to stagnate for a decade the mortgage and remortgage markets have shown signs of recovery. The figures from PwC suggest that this recovery will be slow and take ten years to get back to 1997 levels. John Hawksworth, chief economist at PWC, said: “There is a near 50 per cent chance that real house prices in 2020 could be below 2007 levels. “It is likely to be a long and bumpy road to full recovery.” Max Erskine from remortgagenow.co said: “This prediction sounds worrying, but even if it plays out as PwC says then it is a positive trend. “You have to remember that in 2007 house prices had been soaring for some time. “Values went down during the crisis, but not by as much as in previous slumps. “The fact the recovery might be slow is a lot better than the experts predicting that a recovery will never come. “It will give confidence to the mortgage and remortgage markets because those buying property will have confidence that the value of their homes will continue to rise and that they won’t end up in negative equity. “We can expect prices to stumble along in general terms but also there will be regional variations. “In some cities prices will go down slightly but in other areas, especially around London, prices will go up. “There are also incentives now for the housing market to pick up – buying is cheaper than renting, mortgage offers are getting better with much smaller deposits, and the prices are lower than they were. “I think the recovery will be better than anticipated and because demand is still greater than supply the values will increase more quickly and we will be back where we were in less than the decade predicted by PwC.” remortgagenow.co offer the very best remortgage advice and can find you the best remortgage deals |
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