The average price of a house in Wales has fallen by £4,465 in the last 12 months, according to the latest figures from LSL Property Services. However, house sales were up 23 per cent in October compared with September as more first time buyers got a mortgage.
“The Welsh housing market is struggling due to the lack of mortgage finance for lower income borrowers, caused largely by strict lending criteria, and this contributed to house prices sinking for the sixth month in a row in October," said Nigel Favas, Managing Director of Reeds Rains estate agents, who has branches in Wales comments. "Although sales activity increased by 23% between September and October, this says as much about the subdued number of sales in September as it does an improvement in the market. It is sobering that we are currently seeing lower house prices and this is the case in 18 of the 22 local authority areas in Wales.
Favas added that the number of loans advanced to first-time buyers rose between July and September by 10% per cent and that on average, first time buyers in Wales were able to use smaller deposits to secure a mortgage than in the UK overall.
“The Welsh government is taking steps in the right direction," he said, "with plans of new and affordable housing in Wales as part of a new strategy to encourage greater activity in the housing market. The launch of the mortgage indemnity scheme should help people to access higher loan-to-value mortgages from Spring next year. The government’s Funding for Lending scheme is expected to have an impact in the early months of 2013 but it will take some time before we can assess its true impact.”