Shropshire homeowners were today urged to sit tight as new figures revealed the number of homes changing hands had fallen to a record low. Meanwhile, owners in negative equity are growing.
Figures from the Royal Institution of Chartered Surveyors today said estate agents sold an average of just 17.4 properties each during the three months to the end of May.
It represents the lowest figure since it began collecting data in 1978.
The news comes as the BBC reported that more than 23,000 people who took out 100 per cent mortgages in the year to the end of March face being left in negative equity because of falling house prices.
New buyer inquiries dropped for the eighteenth month in a row and the number of people putting their homes up for sale fell for the fifth month in a row. Twenty-six per cent more surveyors were seeing a drop off in new instructions than those seeing a rise.
Shropshire estate agent Nick Tart warned that property prices in the county looked set to fall further but urged people who now find themselves in negative equity not to panic.
He said: “It was inevitable that the bubble would burst but lenders carried on lending more than 100 per cent of the value of the property and a lot of people have been left above the high tide of the market.”
He added that a slowdown in new instructions could support the market.
“We will see further prices fall in the county, therefore you are going to have to sell at reduced prices.
“But if you sit tight it will become a more balanced market again.”
3 Comments
sadly many will suffer from this neg equity , they are working class people who have borrowed money they havent got against something that may be worth this amount but could just as easily be worth less and in many cases the money was used on flash cars/holidays they couldnt realy afford i think sympathy will be little, you take the risk you pay the price we are all reasponsible for our own actions..
With lenders increasing rates on deposit accounts to attract funds it is logical that interest rates on mortages will continue to increase so worsening the effects of negative equity. One aspect that it is hardly mentioned is that the government has undertook to build thousands of new homes to cope with a shortage which will worsen in the next few years. Who is going to build those houses , not I suspect the government who were hoping to use planning gain to fund their plans. With widespread redundancies and housebuilders closing sites and not starting new developments where is the labour and finance coming from ?
quite agree with pr brittain, things are dodgy. near exeter a new town of 3600 houses has planning permission but the main developers persimmon homes have pulled out because who is going to buy them. property prices are holding up quite well down here but some areas will have a drop in price of between 15 and 30%