The peak in property prices, experienced back in 2007, may not be reached again until 2020, according to estate agent Knight Frank. What this essentially means, is that this is the slowest housing market recovery in history.
As expected, London is forecast for the quickest recovery, returning to previous peak prices in as early as just a year. This is great news for the city, however, move up north & the news is far more bleak. The North West & Yorkshire aren’t expected to reach previous heights again until the forecast date of 2020. There is also a clear north/south divide, with the South East expected to peak at around 2016.
You would think upon hearing the news of lower property prices, that first time buyers would be jumping in joy & excitement at being able to afford a new home – but this is not the case. With a recession & a property crash, comes tighter lending. Potential first time buyers aren’t able to take advantage of the low prices as banks aren’t willing to lend the money. However, there is an expected 2% increase in sales for 2013, which could help boost the market ever so slightly.
2012 wasn’t such a terrible year, depending on where you live. The luxury property market saw their values increase by 45%, whereas properties by the sea increased by a whopping 56%. London also saw certain parts increase prices by 5%.
During this recession, house prices have fallen by an average of 12 percent. Despite this drop & the slow recovery, we can lay rest in the fact this is a mild dropped compared to the previous recession, which saw the values of houses drop by a fifth in the early 1990’s. Property investors, and those wishing a future return on their properties are also at a disadvantage, which a stamp duty rate of 7% being introduced in March.
Many thought 2011 was a signal of recovery for the housing market, with property prices rising by 1%. However, Nationwide have said that in 2012, housing prices dropped by just over a percent, reversing the increase seen in 2011.
Along with the peak in 2007, property prices in London were said to have completely broken that record in 2009, jumping 6.5% to an average asking price of £461,157. This was also, however, the year that stricter lending reform were brought into place.
For the time being, the market is looking bleak for home owners & potential first time buyers. You are at an advantage if you live in the South, and can look forward to owning your first home potentially sooner than your neighbours up North. Until then, there are many schemes that the government &…