Britain struggling economic recovery, the housing market slump. In the macroeconomic environment and the role of supply and demand, after a short recovery after the recent UK house prices continued to fall, or will once again bottom.
British home track 27, real estate consulting firm released a report, in September the average price of housing throughout the United Kingdom fell by 0.4 over the previous month, creating the biggest decline in 18 months, while July and August than the decrease in the ring were 0.1 and 0.3 . Markets are concerned that British house prices fell for three consecutive months, the country s property market recovery period may be over.
Price reflects an important indicator of the degree of economic boom, the British property market downturn is closely related with the economic recovery is weak. Currently, the British government debt has reached the highest level of World War II. To achieve fiscal balance, the British Conservative Party and Liberal Democrat coalition government took office in May this year, announced sharp cuts in public spending, including tax increases, including the emergency and budget. Among them, the cuts in public spending 60 years creating the highest level.
Some market participants worry that the economic recovery has not yet stabilized in the case of the introduction of large scale exit plan could lead to the British economy back into recession. The negative outlook on the economy to some extent expected to suppress the price.
Strong supply of housing is also an important factor in depression. Office for National Statistics recently released data show that the second quarter of this year, the UK construction industry output value of 8.5 over the first quarter surge. Construction boom has brought housing supply increased in July this year, sales were weak UK housing market, housing supply, but there the fastest pace in more than seven years; August UK new supply 2.92 million units, an increase of 41 over last year , and record single month record high of new supply.
Relative to the construction industry in full swing, the British home sales industry is still bleak melancholy. Under normal circumstances, a rigid demand for first time buyers play an important role in driving sales. However, due to lack of consumer confidence, the British first time buyers into the market this summer, the amount was a record low this year, nearly one third less than the same period last year. September the number of new buyers decline of 2.9 over the previous month, a record the largest decline in 18 months.
In addition, the bank raised the loan threshold is not conducive to housing sales. Bank of England since March 2009 has been short term interest rates at 0.5 of the historically low levels the same, but the current major British mortgage loans issued by commercial banks in 2007 was only half of the market peak. By the U.S. subprime mortgage crisis, many British banks to increase loans to the threshold, the number of home buyers get in the door. The tight credit environment, potential buyers will undoubtedly also weighed on the purchase of enthusiasm.
Buy and sell hard in the dilemma of difficult, you can expect the UK housing market recovery will come a long way. Disney Whale analyst recently told reporters that Castro, by the impact of the macroeconomic situation, the British housing market after the 2012 London Olympics may be restored to pre crisis levels.
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