A net 39.8 percent of respondents to the central bank’s credit conditions survey said demand will rise, up from a reading of minus 23.5 in the first quarter, according to the report released in London today. A net 3.2 percent said the availability of secured credit will be little changed from the first quarter.


”Lenders expected demand for secured lending to increase over the next three months as the effects from these temporary factors waned,” the report said. “Some lenders commented that much of the fall in demand in the first quarter was driven by temporary factors, such as the cold weather and the ending of the stamp duty holiday.”

The recovery in Britain’s housing market has shown signs of faltering as upcoming elections make people more wary of buying or selling property. Prime Minister Gordon Brown’s Labour Party and the opposition Conservatives are trying to convince voters they are best placed to cut a budget deficit without strangling growth. At about 12 percent of gross domestic product, the shortfall rivals that of Greece.

Lenders forecast “little change” in housing market conditions, the report said. Recent data on house prices have sent different signals. Hometrack Ltd. and Nationwide Building Society both said house prices rose in March, while Lloyds Banking Group Plc’s Halifax division says the average cost of a home fell 1.5 percent in February.

The Conservatives had a seven-point lead over Labour with 38 percent support, though that’s not enough for a majority in Parliament, according to a YouGov poll for the Sun newspaper yesterday. Brown must hold an election by June. Brown’s government is trying to keep the housing recovery on track.

Chancellor of the Exchequer Alistair Darling last week scrapped a tax on house purchases for first-time buyers spending 250,000 pounds or less. Darling said the policy will mean nine in 10 first-time buyers will avoid the levy.

Source: March edition of the Email4Property.co.uk newsletter

Concerns regarding the sharp rise in inflation in January led to the Governor of The Bank of England having to write to the Chancellor to explain why this was! Increasing interest rates now will only mean another letter in a few months time!

Predictions of an increase in economic growth are strong however, so how quickly the economy grows will reflect quite closely when we see, not if we see, interest rate increase later this year. This balance may not be good news for those homeowners on Tracker interest rates that have been used to such keen rates over the last 18 months. Lets hope that those savings have been working hard elsewhere, otherwise that disposable income may be hard to find again.

My Dear Wife,
You will surely understand that I have certain needs that you, being 54 years old, can no longer satisfy. I am very happy with you and I value you as a good wife. Therefore, after reading this letter, I hope that you will not wrongly interpret the fact that I will be spending the evening with my 18 year old secretary at the Comfort Inn Hotel. Please don’t be upset, I shall be home before midnight.

When the man came home late that night, he found the following letter on the dining room table:

My Dear Husband,
I received your letter and thank you for your honesty about my being 54 years old. I would like to take this opportunity to remind you that you are also 54 years old. As you know, I am a math teacher at our local college. I would like to inform you that while you read this, I will be at the Hotel Fiesta with Michael, one of my students, who is also the assistant tennis coach. He is young, virile, and like your secretary, is 18 years old. As a successful businessman who has an excellent knowledge of maths, you will understand that we are in the same situation, although with one small difference – 18 goes into 54 a lot more times than 54 goes into 18.

Therefore, I will not be home until sometime tomorrow.

Reports say that the bank will be split into a ‘good bank’ and a ‘bad bank’. The bad bank will be the one that repays the tax payer for bailing it out, and the good bank will probably be put up for sale/re-floated onto the stock exchange once again.

Charming! What does this mean for us? Well, if you have a mortgage with what will be the bad bank, then you’ll know about it as it will stay under government control. Does this mean that your business isn’t good enough for a bank being sold?

The likes of Lloyds and RBS are also believed to be thinking along the same lines. This would mean that Cheltenham and Gloucester would possibly be ‘spun off’ as they say. RBS are also be lined up to do the same with some of its smaller brands.

This is a massive part of what any pro-active Estate Agency business development and something that is accepted within the industry.

The interesting thing in the OFT article is that it isn’t the consumer/home owner complaining but other agents.

If the instructed agent is doing a good job and has a contract in place then I struggle to see the problem, unless the homeowner is complaining….

Competition is a massive part of any industry and EA has to be one of the worst, yes there will always be the idiots who drag the profession into the gutter by blatant lies but my view is inevitably they get found out and those cowboys tend to be here today gone tomorrow.

My view as someone who has been in the industry over 15 years is it will always go on and vendors need to be aware of it when they go to market.

If a lesser agent is over pushy and blatantly mis leading a potential seller then they should be investigated by OFT etc and fined where appropriate.

These guidelines need to be set out but as an industry touting should be allowed.

I have heard recently of more touting for rental business and a particular Hampshire agent who is under OFT investigation had sent 19 pieces of direct tout to a property in ONE week…. Stupid there is eager and then there is desperate!

source: Nationwide HPI

• House prices rose by 1.6% in August

• Year-on-year decline slows from -6.2% to -2.7%

• Low interest rates helping to underpin prices for the moment

Commenting on the figures Martin Gahbauer, Nationwide’s Chief Economist, said:

“The price of a typical house rose for the fourth consecutive month in August, increasing by 1.6% on a seasonally adjusted basis. The 3 month on 3 month rate of change – generally a smoother indicator of the near term trend – rose from 2.7% in July to 3.3% in August, the highest level since February 2007. At £160,224, the average price of a typical UK property is still slightly lower than 12 months ago. However, the annual rate of change rose further in August, from -6.2% to -2.7%. Over the first eight months of 2009, the seasonally adjusted index of house prices has risen by 3.2%, though relative to the October 2007 peak it is down by 14.4%.

Inflation report signals that interest rates to stay low well into 2010

“There have been important developments in monetary policy this month, with possible implications for the housing market. Despite further signs of recovery in several key economic indicators, the Monetary Policy Committee (MPC) decided to leave interest rates unchanged at 0.5% and surprised financial markets by injecting a further £50bn of new money into the economy via its quantitative easing programme. The MPC appears to believe that even if the economy does return to growth in the second half of 2009, it will take a long time before the spare capacity left behind by the recession is used up again. As a result, consumer prices may be under significant downward pressure over the next 1-2 years, necessitating an accommodative monetary policy to keep inflation in line with the 2% target. The projections contained in the August Inflation Report signalled that this very loose monetary policy will remain in place for some time to come, with the base rate unlikely to increase until well into next year.

Low interest rates help to explain jump in prices …

“The exceptionally low level of interest rates offers some explanation for why house prices have not repeated the very sharp falls of 2008. There are two main channels through which the low level of interest rates has impacted the housing market. First, mortgage payments for existing homeowners – especially those with tracker or standard variable rate loans – have been reduced substantially. Before the MPC began cutting rates, the average interest and principal payment per mortgage holder represented about 38% of the average post-tax labour income. Following the steep cuts in base rate, this has fallen to just 28% of post-tax income, despite historically high levels of outstanding mortgage debt. The fall in debt servicing costs has meant that fewer homeowners are under immediate financial pressure to sell than might have been expected in a recessionary economic background with rising unemployment. Partly as a result, fewer second-hand properties have come onto the market than is normally the case in recessions, which has contributed to moving the balance of supply and demand more in favour of sellers over the course of 2009.

Reported on findaproperty.com

Here are the key points from June’s National Association of Estate Agents (NAEA) report:

The number of house hunters registered with estate agents decreased from 299 in May to 290 in June.

The number of sales agreed per agent remained high for a third consecutive month with an average of ten (9.5) reported in June – double the amount sold during the worst of the housing market downturn in August 2008.

The average number of properties available for sale decreased from 69 in May to 64 in June.

The number of first-time buyers (FTBs) decreased from 43 per cent in May to 26 per cent.

The gap between asking and selling prices shrank from 6.3 per cent in May to 1.9 per cent in June.

NAEA President Gary Smith said: “The housing market is in a far stronger position than it was 12 months ago. After several months of continuous improvement the market stabilised in June, ahead of an expected seasonal dip throughout the summer.

“It is in the interests of the UK as a whole that the upturn in the housing market that has been noted in the first half of 2009 is sustained and nurtured into a full recovery.

“The Government must do more to ensure that money that has been given to banks finds its way through the system and into the housing market.”

Read the NAEA June 2009 report

Birmingham Midshires for one have increased there standard variable to 2% over the bank of england base rate.

Is this now the start of things to come?

Are the banks/building societies going to start changing more so that finally they will start lending again across the board and offer some attractive products to entice buyers to the market.

Only time will tell….

Not yet over here… but obviously one for us to watch out for, a big brand and serious search technology in place already to make a potentially huge impact on the existing property portal market.