Bethany Smith, mortgage broker at Rose Capital Partners, wants more of the right housing.
She says: “There are other countries looking into modular homes, which from what I have seen is actual affordable housing – built well, but cheaply. This is the type of measure the government should be looking into and investing in.”
Currently, lenders would not accept these builds as suitable security, she explains, “but that is something the government could change by working with lenders to find a middle ground”.
Without action the housing market just will not progress, Smith adds. “If the aim really is to build properties with high EPC ratings, that can be erected quickly and cheaply, then bricks and mortar isn’t the solution.”
Are we in for a dip, a crash or a soft landing?
Research by the House Buyer Bureau suggests that should recession hit, it could take UK property prices nearly seven years to recover.
It analysed house price data across the UK market in the lead up to, and the duration of, the last property market crash. The research shows when recession hit in April 2008, the average UK house price was £183,148.
By the time the nation emerged from recession in June 2009, property values had plummeted by -12.9 per cent to an average of £159,561.
The average house price did not return to the pre-recession level until almost five years later in April 2014. However, the research also shows recession itself does not signal the start of a financial crisis – that usually follows some seven to eight months after.
House price falls
Recession or not, brokers are expecting a fall in prices.
Ian Hewett, founder at The Bearded Mortgage Broker, says: “Mortgage interest rates are now the same level as when I bought my first house in 2009.
"However, house prices are double what I paid then. This can unfortunately mean only one thing: we are about to see turmoil in the housing market.”
Lewis Shaw, founder of Shaw Financial Services, comments that affordability has been “shot to bits by approximately 25 per cent” for residential buyers.
He also expects “a lot of buy-to-let landlords will call it a day when they realise there's no profit to be had if they need to renew their mortgages over the next 24 months”.
Add to this reduced disposable income due to energy costs and inflation, a glut of properties about to hit the market as landlords sell up, as the BoE is predicted to raise the base rate to around 5 per cent by May next year.
