30
May
RICS: Mortgage availability issues affecting housing market
The current difficulties in the mortgage market, with providers
tightening their lending criteria and raising rates, are
"stretching accessibility" and could reduce transaction levels
significantly this year, the Royal Institution of Chartered
Surveyors (RICS) has warned.
Following Nationwide's latest house price data, which recorded a
2.5 per cent fall in average house prices for May, the body
suggested that sellers are choosing to cut prices as buyers are
unable to secure finance.
It predicted that "the market will only stabilise once transaction
volumes recover".
In order to help the mortgage market on the road to better health,
RICS has called on the government and the Bank of England to
continue to implement further measures such as its special
liquidity scheme, "before the drop in transactions and prices
begins to really hurt the economy".
House prices were 4.4 per cent lower year-on-year this month,
according to Nationwide's index, but five per cent higher than they
were two years ago at £173,583.
