Property 'stalemate' continues

12 July 2011 Last updated at 10:22 GMT The market is expected to stay flat this year The UK property market remained in "stalemate" in June, according to the latest survey by the Royal Institution of Chartered Surveyors (Rics).

Prices continued to fall back while sales rose only "marginally".

The continuing downward trend in prices was underlined by the government's own house price index.

The Department for Communities and Local Government (DCLG) said average UK prices dropped by 0.5% in May, and by 1.6% over the past year.

Only in London have prices gone up in the past year, the DCLG said.

"Average prices decreased during the year in England (-1.3%) and also decreased in Wales (-6.1%), Scotland (-2.5%) and Northern Ireland (-13.2%)," the DCLG reported.

It said the average UK house price was now ?203,528.

London resilient

Rics said the number of enquiries from potential new buyers was unchanged while the number of homes put up for sale fell slightly.

Rics said the rationing of mortgage funds and economic uncertainty meant the "stalemate" would continue.

Alan Collett of Rics said: "With continued uncertainty over the jobs market and the economy, this subdued picture is set to continue."

"London, however, remains a market apart with both sales and prices showing a greater degree of resilience."

'Stable conditions'

The Rics survey is based on responses from 272 estate agents who are Rics members, but the survey traditionally has its finger on the pulse of the market.

"Anecdotal evidence from surveyors suggests that the uncertain economic climate is making transactions more difficult and longer to conclude," Rics said.

The Rics survey chimes with the latest data published on Monday by the Council of Mortgage Lenders (CML).

It said that in May, the number of new loans for house buyers rose by just 1.7% from April, to 41,500.

However, this was still 5% lower than the level of mortgage lending recorded in May last year.

Only 15,900 loans were made to first-time buyers, up 0.6% from April but down 2.5% from May 2010.

These buyers were still having to put down deposits averaging 20% of the value of the homes they were buying, reflecting the continued caution of lenders in offering new loans.

"There is no evidence of any drastic changes on the horizon or any significant shifts in direction for the mortgage market," said Michael Coogan, the CML's director general.

"These stable conditions are expected to continue for the rest of the year."

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Property market 'moving sideways'

30 June 2011 Last updated at 06:00 GMT There has been relatively little activity in the housing market this year The housing market has "moved sideways" in the past six months, the Nationwide has said, as house prices remained unchanged in June.

The value of the typical home was the same in June as in the previous month, but 1.1% lower than in June 2010, the building society said.

The average UK home cost ?168,205, the Nationwide said.

It expects prices to change little during the rest of the year, owing to the economic climate.

Forecast

Prices in the three months to the end of June were 0.3% higher than the previous three months, the figures - based on the building society's own mortgage data - show.

"The property market has moved sideways over the past six months, and June's data suggest that trend is being maintained through the summer months," said Robert Gardner, Nationwide's chief economist.

"It is hard to make the case for prices rising or falling sharply over the remainder of 2011 if the economy develops as we expect.

"Economic growth looks set to gather pace in the months ahead, but is likely to remain unspectacular. This in turn points to only modest gains in employment and sluggish wage increases, which will continue to keep many potential buyers on the sidelines."

He added that expectations of the Bank rate remaining at its historic low of 0.5% meant that there would not be a surge of forced sales.

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Property sales 'subdued in May'

21 June 2011 Last updated at 10:09 GMT The housing market has been relatively subdued in recent months Property sales in the UK remained at a relatively low level in May and lower than the same month a year ago, new figures show.

Some 68,000 homes were sold in May, down 2,000 on the revised total of a month earlier, according to HM Revenue and Customs data.

The total was also 3,000 down on the same month a year ago.

Lenders say there is little chance of a rebound in the coming months, judging by mortgage data.

The Council of Mortgage Lenders said on Monday that it expected lending for home loans to be "relatively flat" during the coming months.

This view came despite gross mortgage lending in the UK rising by 12% in May, compared with April, to ?11.3bn. The figure was 1% higher than in May 2010.

Property market commentator Henry Pryor said the low level of sales could have a knock-on effect on related industries.

"Much of the wider economy relies on a healthy housing market with money spent in the High Street on home improvements as people buy and sell," he said.

"Many jobs in the building and decorating businesses rely on a healthy turnover as well as those more directly employed like mortgage brokers, conveyancers and estate agents."

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China property rating downgraded

15 June 2011 Last updated at 05:40 GMT China's strict credit policy is likely to hit new home sales, thus affecting property prices Rating agency Standard & Poor's has downgraded its outlook for China's property market from stable to negative due to the country's tightening credit policy.

The agency said as credit becomes more restricted there was a possibility of a downturn in the sector.

The news comes as latest data showed that foreign direct investment (FDI) in to China slowed down in May.

Rising property prices have become a hot political issue in China.

Restrictive policy

Beijing has been trying to rein in lending in an attempt to control surging property prices.

On Tuesday, China's central bank raised the reserve requirement ratio for the banks to a record high of 21.5%, effectively reducing the amount of cash that they can lend.

Government figures also showed that Chinese banks made fewer loans in May compared to April.

The agency said that all these measure are likely to hit the sector hard.

"We're likely to see more negative rating actions in the next six to 12 months," said Standard & Poor's credit analyst Bei Fu.

"Tightened onshore credit conditions and increasingly restrictive government policy have deepened the market downturn," Ms Fu added.

Slowing investment

While authorities have been working towards restricting domestic credit, the rise in foreign investment in China has also slowed.

According to the commerce ministry, FDI was $9.2bn (?5.6bn) in May, a rise of 13.4% compared with the same month last year.

This was lower than April's 15.2% increase and less than half of March's 32.9% year-on-year surge.

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Property sales still stagnating

24 May 2011 Last updated at 12:23 GMT No sign of an upturn in the housing market yet Property sales in the UK are still lower than a year ago, according to HM Revenue & Customs (HMRC).

Just 66,000 homes were sold in April, 1,000 fewer than in March and 6,000 fewer than in April last year.

Sales in the first four months of the year have been 5% lower than in the same period of 2010.

The figures suggest that with the continued rationing of mortgages, and the economy in the doldrums, there is little chance of sales reviving.

Last week, the Council of Mortgage Lenders (CML) reported that total mortgage lending in April had fallen back from March and was 5% down on a year ago.

The drop was attributed to seasonal factors, such Easter falling in April, and an extra bank holiday.

However, all the accumulating evidence on sales, prices and mortgage lending indicates that the property market has stagnated, with little obvious evidence of any immediate upturn.

The Bank of England reported at the start of the month that the number of mortgages approved but not yet granted, a traditionally accurate indication of near-term trends, had risen in April to 47,557.

But that figure was only slightly higher than the monthly average for the past six months.

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