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Willy Weasel

Bank Of England Summary Of Business Conditions

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I'm on the Bank of England's mailing list and find their summaries very useful. This is an extract from the West Midlands Regional Office summary (my emphasis):

Housing demand continued to contract at a rapid pace. Many contacts judged that the level of activity was currently more depressed than during the early 1990s. The number of repossessions remained low, however. In the market for established homes more transactions were falling through, with some estate agents reporting a cancellation rate of up to 40% recently. That was partly due to the unwillingness of many sellers to accept a lower offer. Also, increasing numbers of potential buyers had either had mortgage offers withdrawn or had pulled out of transactions due to fears of capital losses. Both of these factors were exacerbated by the lengthening period of time between the acceptance of an offer and the purchase being completed, due to a rising number of transactions breaking down elsewhere in the housing chain. Confidence of estate agents continued to decline and more were either making staff redundant and/or closing offices. There were a number of reports of estate agencies refusing to accept new instructions, particularly if the seller was unwilling to negotiate on price, and some had raised their fees to reflect the increased cost of finding buyers. In the market for new housing, the number of starts continued to dwindle. With rising amounts of unsold stock on their books, some house builders were attracting buyers by paying the deposit themselves — having first obtained the agreement of the mortgage lender — or by offering shared equity schemes. Prices of new houses were generally falling faster than in the market for established homes. In some towns and cities, prices of newly built apartments had fallen by over 25% in the past year, reflecting the degree of excess supply.

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  • 401 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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