More UK home buyers are using cash to seal deal
A RECORD high proportion of homes were sold without the need for a mortgage during the first three months of year, a major mortgage provider said yesterday.
The share of cash purchases in the housing market reached an all-time high of 38 per cent in the first three months of the year, according to Nationwide.
“Interestingly, the data suggests that the share of cash purchases in London is not out of line with the rest of the UK. On the surface, this may seem surprising, given the greater involvement of investors (domestic and overseas) in the London property market,” said Nationwide chief economist Robert Gardner. Nationwide also said that house price growth had slowed on the year, with prices 4.6 per cent higher in May than the same month last year. It compared to 5.2 per cent in April.
House price growth is now about half it was this time last year. However, prices may continue to outpace incomes due to short supply.
“In recent years the rate of building activity has remained well below that required to keep up with population growth,” Gardner said.
A separate house price index from Halifax published last month showed annual house price growth running much higher – at 8.5 per cent in April. However, both survey’s show subdued growth rates compared to last year.