- 14 February 2022
- Posted by: admin_gray
- Category: Property
Written by Sapphire Savvy Women Group.
The property market was anticipated to fall, but others were amazed when the market, which had left plenty of room for profit in the last few years, crumbled.
Office for National Statistics data show house prices in the UK fell 15 percent between January 2008 and May of the following year, after which they recovered to growth, and it did not recover until the year 2012.
Sellers resorted to LTVs (loans-to-value) when prices started to drop, to make sure their properties were ready to let, even if it meant selling it at the lowest price, due to the fear of prices dropping even more.
What actually happened?
In its annual report, the FSA stated that over 11% of properties had an LTV of over 90%. In the aftermath of the credit crunch in 2009, the new lending had plummeted below 2%. Many people found it difficult to pay their mortgages due to the downturn in household income. During this two-year period, mortgage back payments averaged almost 3% and were then increased by another two-thirds (£216,400).
The higher market areas where most affected by the crisis, especially the capital. As mortgage inflation took the property market by storm, no property was safe.
Others think what really the problem was the lack of assets being sold without affecting the market, and everything else just snowballed from there.
Will history repeat itself?
As a result of the effects of the pandemic on the economy, many fears this may happen again in the near future, but it is almost assured that this will not happen anytime soon. There is now a much stronger foundation for the housing market, and problems are being dealt with more effectively. Although, this does not mean we are invincible, a situation like this will in the future be recognized better and dealt with appropriately.
It is still very unlikely this would be a problem again. It’s not only almost impossible for it to occur again, but prices can also actually even be seen slowly returning to normal.
What is now happening?
What is happening now is the complete opposite.
In 2022, housing prices are expected to cool even more, presenting a better opportunity for property investors while also benefiting homeowners with their mortgage payments. During the third quarter of 2020, the standard interest rate was just 1.94 percent. Borrowing rates are unlikely to rise any time soon, given warnings to lenders to prepare for negative interest rates.
A catastrophic housing market collapse occurred in 2008, which affected every region of the country (some more than others). It took so many years before the market returned to normal, but once it did, it flourished. Pandemic’s economic makes people worry about its return, but we have learned our lesson and developed new ways of dealing with problems without affecting the business.
Through the steps in this blog, and by the way we do have helpful articles for this, just click here. It is so beneficial to be aware of where you can find the trends and statistics regarding property.
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