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Britain follows Ireland as house values drop By Niamh Hennessy
THE house price crisis which hit Ireland recently has been followed-up in Britain
where values have fallen for the first time since 2005.
Figure relates to August prices and comes after five interest-rate increases
in the past year which has discouraged buyers.
Home owners in Britain and Ireland now face the possibility of the value
of their homes being slashed.
Brian Lynch, living in London and the owner of houses in Ireland and Britain
is very worried about this latest development.
He said: “I was worried about house prices going down in Britain
but I can’t believe the same is happening in Ireland. I just hope
this is a cooling period and not a crash.
Britain’s decade-long property boom is showing signs of cooling
after the Bank of England raised its benchmark rate to a six-year high
in July.
With the US subprime mortgage slump pushing global borrowing costs higher
still, pressure on property prices is likely to increase in coming months.
“The market will soften further,” said Ian Perry, of RICS
estate agents in Britain.
“Potential house buyers have become far more cautious as they wait
and see what effect interest-rate rises will have on household finances.”
Price declines were largest in the West Midlands, the north-west of England
and East Anglia.
The house price index for London the engine of British property market
fell to the lowest since June 2005.
“The interest-rate rises have eventually bitten and their sting
is being felt across all but the highest-value properties,” said
Grant Robertson of Allied Surveyors in Glasgow, Scotland. “Selling
times are very slow.”
Recent reports have sent mixed signals about the health of the property
market in Britain.
HBOS, Britain’s biggest mortgage lender, said prices rose for an
eighth month in August and gained 11.6 per cent from a year earlier. Rightmove,
Britain’s biggest real-estate web site, said London prices dropped
for the first time in a year in August.
But Britain’s economy is also on track to expand at the fastest
pace in three years this year.
Growth accelerated in the second quarter, unemployment dropped to a two-year
low in August and retail sales increased in July, reports in the past
month showed.
Also the Revenue Commissions in Ireland have said that anybody looking
to purchase a home in Ireland and already owns a house in Britain would
most likely be subject to stamp duty.
For more information on this check out www.revenue.ie |
