ROOF Blog

Evidence is growing that the worst is over in the recession-hit property market following a string of cautiously optimistic assessments from the UK’s leading housebuilders.

Persimmon set the tone this month when it predicted a moderate recovery. Barratt, the UK’s largest housebuilder, and Bovis Homes echoed that sentiment with similarly upbeat forecasts.

The number of new homes being built rose to its highest level for over a year in the three months to October, with work starting on 25,000 new properties, an increase of 27 per cent compared with the same period last year.

However, housebuilders are reluctant to be too bold over the prospects of a sustained recovery because of the fragility of the market and the uncertainty over the continuing availability of mortgages.

‘We are way ahead of where we were this time last year, but we’re not out of the woods yet and there could still be plenty of problems for the industry were the banks to pull back lending,’ said Bovis’ chief executive David Ritchie.

The City watchdog’s proposals for the mortgage market received a cautious welcome from the industry today. But trade bodies expressed concerns about how some of the Financial Services Authority’s (FSA) measures would be implemented, as well as the impact a ban on self-certification mortgages would have on certain borrowers. Paul Broadhead, head of mortgage policy at the Building Societies Association, said: ‘We need a sensible balance between appropriate regulation and allowing people to buy their own home when they can afford to do so.’ The Council of Mortgage Lenders said the FSA seemed to believe that regulation could not rely on borrowers behaving in their own interests, but that consumers instead needed measures to be introduced to protect them from themselves. However, Shelter, the housing and homelessness charity, called on the FSA to implement the changes it was proposing urgently to ensure the ‘dark days of reckless lending never return.’