UK property market, negative equity, problem selling a house, home improvement loans, cheap remortgages, building an extension, bedroom in the roof

There are a number of factors that are stopping the UK property market going into total freefall at the moment. These factors are giving a false impression and creating a misguided confidence to potential buyers and investors.

Financial forecasts for the property markets that are sponsored by banks and are obviously trying to talk the market up are being pumped out by their publicity and PR departments.

Start of article about the UK property market.

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The Bank of England has stepped in to support The Northern Rock and is also trying to maintain interest rates at a low level whilst trying to keep inflation down. It's a tightrope walk that could end in disaster. Banks are not passing on the interest rate reductions to their borrowers in an attempt to recoup some of their losses and the high streets are feeling the pinch.

At the same time, property owners, especially those with negative or little equity are trying to hang on without reducing prices and as a result, property sales across the board have stagnated and prices dropped back a little but not significantly.

Estate agents and banks are being bullish about the markets because they claim there is a huge demand still for property and building is not keeping up for demand.

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WHY PROPERTY PRICES ARE LIKELY TO TUMBLE

It is true that there is still a huge demand for property, especially from first time buyers wanting to get onto the property ladder. However, wanting to buy and being able to buy are two very different things. Window shoppers don't generate revenue, no matter how hard they press their noses up against the window.

Most lenders have pulled out of the sub-prime markets and the 100% mortgage market has all but dried up. Furthermore, lending criteria have tightened across the board; the banks don't want to get their fingers burned any further. It means that buy to let landlords and first time buyers are going to find it much harder to obtain a mortgage.

Two years ago, first time buyers were desperate to get onto the property ladder and would jump as soon as they had a mortgage offer and before the price of the property they wanted went up any further. Before the slump, buyers biggest problem was trying to save up for a deposit faster than property prices rose.

Now the best advice is to wait and see what happens. Property prices certainly aren't going to go up for the foreseeable future and are ore likely to drop in value. Savvy first time buyers are now sitting back and waiting for prices to come down and the more that wait, the faster prices are likely to fall. There is no longer the urgency to buy and those that are patient are going to pick up a bargain.

You only have to look into an estate agents window to see the number of properties with vacant possession that are on the market to know that buy to let landlords are now starting to dump properties back onto the markets. Unable to obtain rental incomes that cover their mortgages and faced with negative equity, many are now facing huge financial losses. Read on to discover why we are predicting further falls in the UK property market.

Now is not the time to buy or sell if you don't have to. Buyers should hold their nerve and sellers, unless they have to sell should stay put and invest in increasing the living space within their current properties.

An extra bedroom in the roof or an extension can add 11-15% to the value of your property saving you a fortune on moving. By improving your home, you can save on:

• No conveyancing fees
• No removal costs
• No home information pack
• No stamp duty
• No estate agents fees
• Valuation and survey costs
• Furnishing and redecoration costs
• Far higher mortgage repayments

Property is and will always be a good long term investment, if you need to move in order to gain larger living space, you should investigate investing in expanding your existing home. Read on to discover why we are predicting further falls in the UK property market.