The new houses market in the UK is now taking an upward turn since the economic depression that commenced in 2008. However, real estate advisers continue to give conflicting predictions about the future of the UK new build homes market. The advisers who project continued growth in the sector support their advise by insisting that the demand for houses still way outstrips that of supply. On the other hand, those advising a projected dip claim that investors continue to be conservative while risk takers are preferring to buy foreclose houses and houses in the secondary market. However, irrespective of the stand that an adviser takes on the real estate market in the UK, most of these advisers seem to have changed their stand in the recent past,. This change of mind has been caused by changing parameters in the real estate market. These changing factors have been described below.
Government Incentive on Real Estate Market
In early August 2010, the UK government introduced a new build homes bonus scheme to be distributed through English councils that deal with new houses projects. This bonus has been introduced to stimulate growth in the real estate industry as well as reduce the high demand of affordable new build homes in the UK. In 2009, there were over 4 million people in the council lists seeking for new houses. However, the council only managed to construct 120,000 new built home. The bonus incentive is set such that the government will pay a council the equivalent of the taxes they get from the new build homes for a period of six years. This will work to motivate the council to build new houses so as to benefit from this bonus scheme.
Reduced Foreclose Houses
Another strong indicator of a raising real estate market is the unpredicted reduction of foreclosure houses. The Council of Mortgage Lenders (CML) released statistics that showed a reduction of foreclose houses for the three months ending June 2010. In this period, a total of 9400 houses were foreclosed as compared to 9800 in the first three months of 2010. This was a significant drop compared to the 11800 houses foreclosed in the same period of 2009. The reduction in foreclose has lead to a revision of the projected foreclosures for 2010 to 39000 down from 53000. The reduced foreclosure indicates that people have found a working way of managing their mortgage payments. With reduced foreclosure houses, investors who were cashing on foreclosure houses will now seek to purchase new build homes and thereby increasing the demand and prices.
Low Interest Rates on Mortgage
Another boost to the real estate industry and especially the new houses market is the low interest rates in mortgage. The reality is that there are still many new people being employed and the reduced interest rates are making it much more affordable to afford the new houses. Therefore, the demand for these new build homes is still strong. Many real estate agents are reporting a huge demand of new buyers inquiring on new houses options within the UK. Changing Market Trends in The UK New Build Homes Market
Statistics now reveal that the average prices of houses is now beginning to rise. Many new build homes agents and real estate companies have started seeing a raise in the real estate overall prices. This has come after a continuous drop in prices since the mortgage crunch that began in 2008. Areas that had house prices reducing are now either having the prices constant or slightly raising. This change in market direction is projected to trigger many market reactions. Firstly, the investors who were waiting for the lowest prices will now seek to invest fast to avoid paying more with a raising market. This may caus