Rightmove, the property portal, reports that since the
beginning of the year new homes for sale has slumped to its lowest point in
more than a decade. Only 34,433
properties have come on to the market equating to around half of pre-credit
crunch levels.
This comes at a time when emerged borrowing costs have
fallen to a 14-year low with the average mortgage payments for new borrowers
standing at 27 per cent of disposable earnings. Good news for those with
existing mortgages but still no hope for those people trapped in rental
properties without the money for the deposit.
Those who do have the cash to put down on a deposit have
their own problems given the shortage of new homes. This has in turn created in
certain areas a high demand for property and perhaps explains why property prices
have remained more or less unchanged.
It has also led to those looking to buy to be more selective
in their hunt for a suitable property and one that fits their budgetary
constraints.
The situation is likely to get worse when the stamp duty
holiday for first-time buyers ends this spring.
So why is there a shortage?
We seem to building less new homes than before and this combined with
the economic uncertainty and owners worried about replacing their existing mortgage, there appears
little hope for any immediate change.
Morgan Jones and Pett are solicitors who provide legal advice and services to clients based in England and Wales and who can be contacted on 01603877000 or via email at davidpett@m-j-p.co.uk
