Cautious buyers scrap plans to move house

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by Kay Murchie

Many thousands of homebuyers have scrapped plans to move house after the British banking crisis surrounding Northern Rock led to insecurity in the property market.

Estate agents have seen the number of enquiries fall by 25% and the number of potential customers visiting estate agencies has declined too.

Hurford Salvi Carr, the London-based agents, said internet enquiries on its site fell by between 20%-25% after the announcement about Northern Rock’s bail-out.

A spokesperson for the agency said the public’s desire for buying and selling property completely dropped off although some of this has now returned. The agency does not believe it is a coincidence that their quietest weekend of the year happened after the Northern Rock share crisis.

Propertyfinder.com, the property website, admitted that Northern Rock is going to make people delay decisions but they believe confidence will return to the market.

A spokesperson for the online property marketplace Houseweb.com, added that a small amount of pressure has been applied with the Northern Rock situation. However, the market had already been cooling following the launch of Home Information Packs and increasing interest rates.

Property website, Rightmove, showed prices fell in August by a national average of 2.6% with some boroughs in London experiencing greater falls.

Uncertainty over what would happen to the cost of mortgages is making the future of UK house prices difficult to forecast, according to a chief UK economist at investment bank Morgan Stanley.