Housing market is uncertain

8:44am Thursday 12th June 2008

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THE fall in property prices in Worcestershire is slowing down. Fewer estate agents reported a drop in prices in May, more reported a rise and almost a fifth said the market had stayed the same as in April.

The figures are revealed in the latest survey by the Royal Institution of Chartered Surveyors, which showed a number of chartered surveyors in the county are reporting a price fall drop slightly in May to 76 per cent, down one per cent from April. A further 18 per cent said that prices have remained the same and those reporting a price rise increased slightly from four per cent to five last month.

However, demand remained low in the region with chartered surveyors reporting a fall in new enquiries once again. The average number of sales per business also fell.

Richard Franklin, RICS West Midlands spokesperson and divisional development director at Persimmon Homes, said: "The drying up of mortgage products has significantly affected the West Midlands housing market and sales are becoming difficult to achieve.

"The purchasers are out there but the financial situation can let them down when trying to buy. Banks are lending considerably less than at this time last year, causing a stalemate in the regional market."

One Worcester agent has launched a new idea to break the deadlock with what it calls a wait and rent' scheme for homeowners who want to move. Richard Shenton of Premier Places explained: "We let their property initially on a six-month short hold tenancy, provide a let to buy mortgage from our independent adviser and even help many of them with the negotiations of their onward purchase.

"This has been working very well and we will continue to offer this as part of our everyday service. It's been approximately six months since the first wait and rent' and we have since achieved several sales on these properties and delighted our clients."