House prices are standing still

Mortgages completed by borrowers through mortgage brokerage AWD Moneyextra have fluctuated in a very tight range of just a few hundred pounds for the last three months.

The average value of mortgages completed by AWD Moneyextra customers in September was £151,464.16, compared to £151,709.75 in August and £151,488.09 in July.

Robin Amlôt, Senior Editor of Moneyextra.com, said, “It’s becoming clear that the mortgage market peaked in May this year and was already on a down-trend before the summer credit crunch hit. A house price ‘crash’ remains unlikely but the rapid slow-down in activity in the mortgage market may feel like a crash to some.

“The Bank of England’s five base rate rises to July 2007 are now really biting as fixed-rate mortgage deals arranged in 2005 come to an end. At the same time the credit crunch has caused lenders to tighten up their lending criteria and reduce the number of mortgages they offer.

“It’s not all doom and gloom for some borrowers, those with blemish-free credit records can still take advantage of highly competitive interest rate offers. But life has become harder and significantly more expensive for the rest.”

The average property value of £222,7921 in September is up 1.25% on August and is the highest since June but still below prices seen earlier in the year and is only 2.59% up on year ago levels. At the same time, the average mortgage being sought by first-time home buyers was £133,522, down 4.72% on September 2006.