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A “two-tier” housing market is emerging in Britain as the top end races ahead while prices of cheaper homes fall.
Building society Nationwide today said the average house price slid 0.5% to £169,347 in July after a flat month in June.
It said only buyers with “relatively large financial resources” were able to take the plunge. First-time buyers, the less-well off, and those worried about their jobs struggled to get mortgages.
The Bank of England said mortgage approvals fell from 49,461 in May to 47,643 in June.
David Smith, senior partner at estate agent Carter Jonas, said: “We are beginning to see a divide in the market between the mid-to-higher end, where demand is strong and prices are firm, and the lower end, where confidence and the ability to arrange mortgages are constraining factors. A two-tier market is beginning to form.”
Reader views (12)
I think we should all sit back, look at house as homes and let the natural demand/supply forces determine where prices should be in the long run. This contradictory month on month reporting is rather sickening at times.
- A Seguya, Croydon, UK, 30/07/2010 21:57
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As Carter Jonas says, it does appear that a 2 tier market has developed. In the 350K to 2M price bracket for UK "waterfront properties" and "properties with land", BIGbleu are seeing a fall in supply (not an increase as most property websites have reported) and buyer interest at its highest this year. In central London we are also seeing strong demand for rental property, very limited supply and rising rents. We think the evidence points to higher London house prices in the 350K-2M bracket by the end of the year.
- BIGbleu, BIGbleu, London, 30/07/2010 16:59
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It's the usual August holiday lull.
No doubt, September's headlines will be "house prices rocket".
Well, I guess you bored journos have got to write about something.
- Simon, London, 29/07/2010 18:44
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"A “two-tier” housing market is emerging in Britain as the top end races ahead while prices of cheaper homes fall."
Really? That's not what rightmoves latest survey says. Asking prices in Kensington and Chelsea plummeted 5.2% in July!!
- Henry, London, 29/07/2010 18:26
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I'm looking to buy in north london Essex borders and prices have gone up 18% in thele last year, waltham forrest in among the cheaper london boroughs so that maybe why, but we are struggling to find affordable 3 bed house's, Hackney and Islington has dropped 4-5% but they were over priced to begin with, we should have bought a few years ago instead of thinking prices would fall fall fall.
- John smitten, London, 29/07/2010 14:46
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Prices will stay flat for a few more years. There is little demand out there at the moment, even in London given credit restrictions. So prices will come back to reality but it will take time. Rental vacancies are high compared to pre 2007 in London, shows demand is still low.
- Mike, London, 29/07/2010 11:12
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Can't find buyers? Well apart from being very difficult to gain a mortgage, ahh self certification slashed, reality hits.
I keep up to date of the W5, W13, part of London and see prices higher than before 2007. Who wants to give £300K for a poky 2 bed flat? What first time buyer, on the London average wage can even afford that and have the required 25% deposit.
The gravy train is over - sellers need to wake up - reduce price if they are serious about getting shot of their propery - there are few mugs left with wads of cash to burn willing to buy not unless you live in central London. Our youngsters are priced out of the markets, which is so wrong. BTL now facing 28% CGT on any over inflated property they now purchase. Even the BTL know buying now does not make good financial sense not unless they can get a "properly" priced property.
- Tessa, London, 29/07/2010 11:12
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I'd have to concur with Karenf, my neighbours sold to someone without a chain but the sale fell through because they couldn't find anywhere to move to, the buyer pulled out and found somewhere else after 6 weeks.
- Bob, Cheam, 29/07/2010 10:25
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Buyers dry up, More like the buy to let brigade have been finding it harder to buy more houses now the banks are more careful...Also could be due to the fact house prices in this country are way too high and have been kept that way due to pigs in the trough (government, banks, millionaire investors)
- DC, Ealing, 29/07/2010 09:59
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At least it is the end of, "I've got a patio and an extension and the one up the street doesn't and sold for a £zillion so mine must be worth at least a £trillion zillion".
- BJ, East London, 29/07/2010 09:55
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Not in SE London!!! Not enough properties for buyers. We are always being asked if we want to sell.
- Karenf, London, 29/07/2010 09:40
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Thats odd, the DT says it's fears over the economy. Me, I think it's because fewer people wanted to buy houses.
Theories, eh? you, me and te DT all have them and they are equally worthless - except I don't try to pass it off as an absolute truth.
You really don't have try to invent report tell bad news all the time now that this is a free paper.
- trip hazard, cambridge, 29/07/2010 09:20
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