Figures out last week confirmed that, after six consecutive quarters of contraction, the UK is finally out of recession. The state of the UK housing market was well documented during the downturn, with property prices, mortgage availability and Government rescue packages dominating the headlines.
But how did the industry really fare in 2009 and what does 2010 hold for the sector? Debbie Whittingham, North Yorkshire sales and marketing director for one of the UK’s largest housebuilders, Taylor Wimpey, reflects on the last 12 months and looks forward to what the next year might hold for those thinking of moving home or getting on the property ladder:
There is no doubt that the last couple of years have been challenging for the UK property industry, but conditions improved considerably in 2009. We saw a return to a more stable market, with small incremental house prices rises, more visitors to our developments and an increase in our reservation rate of 37.5% on 2008. We have also seen a real return in consumer confidence, with a much lower cancellation rate in 2009 compared to the previous year.
2009 certainly saw clued-up buyers take advantage of lower house prices, record low interest rates and the wider range of practical and financial assistance schemes on offer both from housebuilders and the Government. The Government introduced a number of initiatives in 2009 to help those struggling to buy their own home, including schemes such as Homebuy Direct which offered equity loans, interest free for a set period.
Figures out at the start of January painted a positive picture of the property market in 2009. The Bank of England reported that the number of mortgage approvals had more than doubled in the previous 12 months and net lending had increased for the third month in a row, both indiciators of increased activity in the housing market. The Council of Mortgage Lenders predicted that net lending on homes would double in the following 12 months from £8 billion to £15 billion and the number of housing market transactions are also expected to rise. According to Nationwide, average property prices rose by 5.9% in 2009 and the Halifax First Time Buyer Annual Review revealed that home affordability had improved significantly for potential first time buyers over the past year.
Recent research published by Halifax also provides a stark reminder that property remains a good investment in the long term. Its figures showed that house prices had increased by 105% in inflation-adjusted terms over the last 10 years, the largest rise of any decade in the last 50 years.
So what does the start of a new decade hold for the UK housing market? According to Nationwide, property prices rose by 1.2% in January, the biggest advance since August. The Centre of Economics and Business Research has also revised up its forecasts for property price growth in 2010 to 6%.
The availability of competitive mortgage deals in 2010 will be vital for further improvements in housing market conditions and the fact that both Lloyds Banking Group and Santander have announced that a wider range of mortgages with a loan-to-value of 90% should become available over the next few months is also good news for buyers.
We will complete the conversion of our Bryant Homes and George Wimpey developments to the Taylor Wimpey brand this year and will also be introducing an exciting new range of house designs. Our focus will remain on providing the right homes in the right location as well as the right kind of financial and practical help that our customers need to get on and move up the property ladder in 2010.
See Also: Property News (5994), Housing Market (3), Government (15), Taylor Wimpey (1571)
Date Published: 05 February 2010
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