United Kingdom New Property Market demonstrates First Signs of Renaissance
Wednesday, July 8th, 2009 Subscribe To Our Feed
Leading UK House builder, Taylor Wimpey announced today that it is encouraged by stability in the property market. It has been reported that their forward orders have increased by 73% since the end of December 2008, and they are currently experiencing a fall in the quantities of cancelled orders. The conclusion would seem to be that Property prices are now broadly flat and that new Property buyers are returning to the market in significant numbers.
Forward orders are contracts by individuals to buy homes from developers. An increase in forward orders tells us that more people are ready and willing to enter into new home purchases. This gives the builder the comfort of knowing that he’ll have a Quick Property Sale as soon as the home is built. The reasons for this improvement in forward orders are thought to be twofold.
Firstly, purchaser confidence is growing. Pent up demand for new properties is now beginning to play out, and buyers who just a few weeks ago kept their hands in their pockets are now ready and willing to make the purchase commitment. This is further fuelled by the, albeit slow, growth in mortgage availability and the slackening of mortgage terms and interest rates. Property constructors are also currently offering the best buying incentive schemes seen for many years, further boosting demand.
Secondly, new Property buyers are on the increase because they are beginning to achieve sales on their existing homes. This is an extremely significant effect. If sales of older properties are impeded then owners cannot fulfil their dream to climb the property owning ladder, and so will be unwilling or unable to make forward commitment to Property constructors. Selling your house at a lower than expected price is more acceptable when you are buying from a Property developer who is pricing aggressively and offering an excellent incentive package.
The constructor has to Sell Property Fast, as soon as he’s completed it, and if you can get yourself in the position of a cash Property purchaser; you’ll be able to achieve a fantastic discount. So much so that it might well pay you to sell to one of those “Sell my Home fast” firms to allow you to make a speedy sale of your old property even though that will involve discounting it heavily.
Taylor Wimpey is the leading new Property construction company in the UK and a 73% growth in forward orders is a highly significant one. There are now grounds for genuine hopefulness that the home value plunges of the past 2 years are now a thing of past, and that sales of homes will go on climbing and start to push prices back up in the short to medium term.
An additional positive effect is that in order to fulfil growing demand; Property builders must increase their construction activities and will need to re employ staff and workers previously laid off. This will at least slow the rate of increase in unemployment, and will have a knock on effect for the economy overall, upstream industries, such as raw material production for the building industry will see an increase in orders which again will feed back into the overall economy.
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