Many people are surprised to find that every month over 11,000 new properties are completed every month throughout the UK. This is less than a few years ago, when the figure was closer to 18,000, however there are still plenty of new homes for sale within the UK.
Why House Building Has Tailed Off
There are several reasons why the rate at which homes in the UK are being completed has slowed down. Without a doubt, the main reason is the recession.
Many UK homeowners are deciding to stay where they are on the housing ladder rather than stretch themselves. However, a significant group of people have not actively taken the decision themselves. Rather they have become stuck by circumstances in their current home.
First time buyers are still struggling to get on the housing ladder. Despite the fact house prices have dropped considerably in the UK, many people simply cannot save up enough for the necessary deposit. The days of 110% mortgages are long gone. Today a 15% deposit is about average. House prices will need to fall much further to make saving this amount possible, especially with the cost of living going up and wages being cut. Mortgage companies are also being far stricter about who they lend to and how much they will lend them.
Existing Homeowners Also Struggling to Buy Too
However, it is not just first time buyers who are stuck. Many existing homeowners would like to move. They have the income to do so, but cannot get the same level of mortgage they once could.
The drop in house prices has also created a significant number of current homeowners living in homes, which are worth less than they paid for it. They are effectively in negative equity. This means if they want to move they will need to pay out more than they are paid for their current home.
However, there is still some demand for new housing in the UK, so builders are still building. They also have an eye on the future when growth in population will eventually lead to a physical shortage of residential properties of all kinds.
To find the best of the new homes for sale in the UK and for advice on how to buy even in the current climate visit the What House website.