Asking prices drop by 2.1 percent in August

Property portal Rightmove reports a 2.1 percent drop in asking prices in August, the second consecutive drop in as many months. Asking prices now stand at 0.3 percent lower than they were 12 months ago, however average asking prices are still up to 14% higher than the average selling price of £203,528.

House prices fall to a 21 month low

LSL Property Services have reported that house prices have fallen a further 3% in the second quarter of 2011, bringing the average house price on the Acadametrics index down to £217,300, the lowest since December 2009. The gains seen throughout 2010 have been wiped out, although prices remain higher than the £200,000 low point reached in April 2009.

David Newnes, director of LSL Property Services, said,

"The fact that prices have only fallen by 0.1% means the steep declines between April and June have ceased. Transactions met their expected seasonal rise of 5% in July. This indicates that the market is not falling off a cliff in the short term, but that it remains weak in the longer term.
Of all types of property, flats have shown the weakest growth in transactions. This indicates that the first-time buyers who would normally be driving the market for smaller properties remain excluded from the market."

The report follows a similar one by the Royal Institution of Chartered Surveyors who said that house transactions are at a two year low, with estate agents selling only 14.2 properties on average over a three month period.

Introducing FirstBuy

The government has launched a new scheme in partnership with 100 housebuilders aimed at helping first time buyers get on the property ladder.
This scheme, called FirstBuy, will see the Government and housebuilders provide buyers with an equity loan of up to 20%, meaning potential buyers will have to put up a 5% deposit to qualify for a 75% mortgage.

Independent article

Two-thirds of would-be first-time-buyers unlikely to purchase in the next five years

A new report commissioned by Halifax has revealed that the high cost of property coupled with stricter lending criteria has led to drastically changing attitudes towards home ownership from younger people.
The Guardian reports,

"In a survey of 8,000 people aged between 20 and 45, only 5% of those described by the Halifax as "Generation Rent" (those with no realistic prospect of getting on the housing ladder) are making spending sacrifices to save towards their first home. The remaining 95% have no spare cash, no interest in saving or are trying but failing to save.

Almost half the people questioned predicted that Britain would become a nation of renters within the next generation."

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