There’s no doubt about it. The present Financial Crisis has caused mortgage lending to tighten up fairly severely. In actual fact most couples, even those with first class credit histories find themselves unable to buy homes or refinance them. In addition, it’s forecast that the net new lending figure for the House Sales UK market in 2009 will very likely be negative. That is to say that more mortgages in monetary value will be paid off by the borrower or called in by the lender, than the total value of new loans that will be granted.

As we all know, this crisis, along with rising unemployment have put a complete damper on House Sales UK. Property Owners aren’t routinely thinking about trading up to Buy Homes which are bigger or more desirable as soon as they’ve received a few pay rises since they purchased their current Property. On top of that, those potential New Property Buyers who’ve managed to save up enough funds for the new larger deposits are scared to jump in and Buy Homes at the moment, because they’re scared that it might mean putting all their savings at risk.

These people know that, in the worst case situation, they could end up simultaneously in a negative equity situation at the same time as potential future interest rates could render their mortgage unaffordable. In that situation, it’s a very real risk that they could have their Property repossessed. If that does come about, they’ll have lost all those savings they put down as a deposit. At the same time they will have lost their house and had their credit record ruined.

Small wonder then that Property Property Developers have put almost all their Property Building projects on hold until the House Sales UK market picks up. This is where there are extra opportunities for those individuals and companies who’ve become home buyers during present crisis. Lately, these investors have been taking advantage of the low Property values to enter the market at very advantageous rates, calculating that these will give them exceptional returns in the medium to long term as the House Sales UK market returns to normal.

As Property Construction grinds to a stop, the number of Homes available for purchasers to actually buy is reduced, and so the laws of supply and demand come into effect, and we can see that Property value falls have now slowed right down.

Nowadays those same investors are not so much seeking to Buy Houses. They’re buying up surplus building land, which cash strapped Property Builders are being forced to sell off in order to keep their cash flow in order.

This entry was posted on Tuesday, December 30th, 2008 at 7:33 am and is filed under Real Estate. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.