House Value Reductions Appear To Be Slowing At Last
Posted by admin in News
Latest statistics released by a primary player in the House Sales UK market show that the reduction in Property prices slowed reasonably considerably in October. The rate of fall was 0.4%, as opposed to 1.3% for the month of September.
The statistics were published by the Nationwide Building Society, which is one of the primary players in the House Sales UK market. The Nationwide is one of the very few of the old mutual Building Societies to have succeeded in maintaining its mutual society standing. In reality it’s the ONLY big one to survive the rush for demutualization a decade or so ago. Since then it has steered a very conservative course through the more recent rush for buying into the derivatives and U.S. Sub Prime Mortgage markets. The society stubbornly stuck to its core values, and stuck to the old fashioned, and at the time very unfashionable business model, of raising money by taking deposits from its cash rich customers, and using those funds to lend to its own younger customers who need loans to Buy Houses.
As a consequence of this fairly conservative policy, the Building Society’s management now finds itself totally vindicated for not following the herd instinct of the other big financial institutions. It finds itself in an almost embarrassingly popular position with depositors, because they in turn recognise the fact that the society’s cautious policies have been vindicated, and they’re additionally very much attracted by society’s continued mutual status, which makes it very effectively insulated from the vagaries of the world’s stock markets. All the above makes the Nationwide a player to watch, listen to & respect, as it becomes an even stronger player in the House Sales UK market.
This slowdown in the rate of fall in Property prices can only help to attract more Home Buyers back into the market, and so the rate of fall could be slowed even further over the coming months. Keep in mind that House Buyers aren’t just people looking to Buy Houses to live in. There’s a large and expanding number of families and companies who see Properties as a secure home for their excess money. These people and companies have begun to think this way after seeing several famous banks fall. They’ve realised that significant deposits held by private individuals, and all monies held by limited companies are not safeguarded against Bank failures. Properties, on the other hand, can’t disappear, even if they can lose part of their value over the short to medium terms.