Keywords
Citation
(1999), "Stable housing market", Property Management, Vol. 17 No. 1. https://doi.org/10.1108/pm.1999.11317aab.021
Publisher
:Emerald Group Publishing Limited
Copyright © 1999, MCB UP Limited
Stable housing market
Stable housing market
Keywords Housing market, Statistics, United Kingdom
Housing market activity is likely to remain subdued in 1998, with homebuying and selling at modest levels and house prices increasing less dramatically than in 1997, according to Barclays Mortgages in September 1998.
Stability is a healthier prospect for the economy than the highs and lows of the late 1980s and early 1990s, but consumer confidence is still key to maintaining this balance.
Barclays Mortgages Consumer Confidence Research shows that house price confidence is declining steadily, with only 42 per cent of those surveyed now believing that their homes will increase in value in the next 12 months, compared with 53 per cent 12 months ago (see Figure 2).
Buying and selling intentions are slightly more encouraging, with more people now prepared to put their property up for sale (one in 12 compared with one in 13 previously) and one in four looking to buy a new home.
In contrast to the housing market picture, mortgage lending continues to show strong growth, as forecast by Barclays Mortgage Index last month. The value of gross mortgage advances in August 1998 was 20 per cent higher than in August 1997, despite a fall of 11 per cent month-on-month which was a seasonal correction to the record lending in July 1998 (Tables I and II).
The growth in mortgage lending is still dominated by re-mortgaging as lenders continue to offer longer-term fixed rates at attractive prices.
Commenting on the findings, Barclays mortgages marketing director, Jim Chadwick, said: "We have been saying for some time that confidence is slipping and were it not for fixed rates and re-mortgaging, the current lending figures could be much less healthy. It is the industry's responsibility to help homebuyers understand that a stable housing market is in everyone's best interests even if it not as exciting as a boom".
Figure 2.Barclays mortgage index UK gross advances. Year-on-year change (%)
Barclays Mortgage Index is a monthly measure of gross new mortgage advances and is designed to provide an early indication of trends in the mortgage market. The index is based on flow of funds through solicitors' deposit accounts, of which Barclays has a market share of approximately 30 per cent. Most of these funds are for mortgage advances and are drawn from the full range of mortgage lenders, not just Barclays. Barclays Mortgage Consumer Confidence Research is conducted by NOP Consumer Market Research. The survey covers around 1,000 people per month aged over 20 years.
Table I
| Mortgage index | |||||
| Mortgage index | 269 | ||||
| Month | August 1998 | £m | change | ||
| Forecast UK advances | 8,478 | ||||
| Previous month actual | July 98 | 9,506 | 11% | ||
| Previous year actual | August 97 | 7,065 | +20% | ||
Table II
| Mortgage index | ||||||||||||||||||
| UK gross | Month on | Year on | UK gross | Month on | Year on | |||||||||||||
| mortgage | month | year | mortgage | month | year | |||||||||||||
| advances | change | change | Mortgage | advances | change | change | Mortgage | |||||||||||
| Month | (£b) | (%) | (%) | index | Month | (£b) | (%) | (%) | index | |||||||||
| Jan-93 | 3.1 | | | 100 | Oct-96 | 6.8 | 13 | 43 | 217 | |||||||||
| Jan-94 | 3.4 | 23 | 7 | 107 | Nov-96 | 6.8 | 1 | 28 | 216 | |||||||||
| Jan-95 | 3.6 | 20 | 8 | 116 | Dec-96 | 6.2 | 9 | 27 | 197 | |||||||||
| Feb-95 | 3.6 | 2 | 5 | 113 | Jan-97 | 5.2 | 16 | 22 | 166 | |||||||||
| Mar-95 | 5.0 | 40 | 3 | 159 | Feb-97 | 5.1 | 2 | 21 | 163 | |||||||||
| Apr-95 | 4.3 | 15 | 9 | 136 | Mar-97 | 5.7 | 11 | 5 | 181 | |||||||||
| May-95 | 4.8 | 13 | 1 | 153 | Apr-97 | 5.9 | 3 | 14 | 186 | |||||||||
| Jun-95 | 5.4 | 12 | 1 | 171 | May-97 | 6.4 | 10 | 3 | 205 | |||||||||
| Jul-95 | 5.1 | 6 | 8 | 161 | Jun-97 | 7.0 | 9 | 15 | 224 | |||||||||
| Aug-95 | 5.4 | 6 | 3 | 171 | Jul-97 | 7.9 | 12 | 11 | 250 | |||||||||
| Sep-95 | 5.0 | 7 | 5 | 158 | Aug-97 | 7.1 | 10 | 3 | 225 | |||||||||
| Oct-95 | 4.8 | 4 | 1 | 152 | Sep-97 | 6.9 | 2 | 15 | 221 | |||||||||
| Nov-95 | 5.3 | 11 | 4 | 168 | Oct-97 | 7.0 | 1 | 3 | 224 | |||||||||
| Dec-95 | 4.9 | 8 | 7 | 156 | Nov-97 | 6.3 | 11 | 7 | 200 | |||||||||
| Jan-96 | 4.3 | 13 | 17 | 136 | Dec-97 | 6.7 | 6 | 7 | 211 | |||||||||
| Feb-96 | 4.2 | 1 | 19 | 135 | Jan-98 | 5.3 | 21 | 1 | 167 | |||||||||
| Mar-96 | 5.5 | 29 | 9 | 173 | Feb-98 | 5.3 | 1 | 4 | 168 | |||||||||
| Apr-96 | 5.1 | 6 | 20 | 163 | Mar-98 | 6.8 | 28 | 20 | 216 | |||||||||
| May-96 | 6.2 | 21 | 30 | 198 | Apr-98 | 7.0 | 3 | 20 | 223 | |||||||||
| Jun-96 | 6.1 | 2 | 14 | 195 | May-98 | 7.1 | 1 | 10 | 226 | |||||||||
| Jul-96 | 7.1 | 15 | 39 | 224 | Jun-98 | 8.4 | 18 | 19 | 267 | |||||||||
| Aug-96 | 6.8 | 3 | 28 | 217 | Jul-98 | 9.5 | 13 | 21 | 302 | |||||||||
| Sep-96 | 6.1 | 11 | 22 | 193 | Aug-98 | 8.5 | 11 | 20 | 269 | |||||||||
Barclays Bank PLC is regulated by the Personal Investment Authority and represents only the Barclays Marketing Group for life assurance and pension business.
Website address http://www.barclays.co.uk