Financial Reform

Category Archives: House Prices

Housing Benefits Cut to Devastate Nearly 1 Million Customers

The government is continuing with welfare reform cuts, which are creating a number of problems for many citizens. According to the Chartered Institute of Housing, many cuts are expected to force a number of families to decide between paying their rent or eating. About 800,000 families are going to have to make that decision within the next few months.

According to the ACIH, there will actually be many more families living off of benefits than there will be houses that they can afford with the state benefits. Unfortunately, they are going to have even more trouble in the coming months. As a result, many of the people living in these areas are going to be forced to move to more affordable areas. This doesn’t leave many options for them except the impoverished areas near the coast and northern England.

Beginning in January, the government has decided not to pay more than £250 a week for families living in two-bedroom homes. That act of reform would be painful for many families in and of itself. However, the government has gone beyond simply capping the weekly housing allowance. They have also decided to force families to live in housing with the cheapest third of rent in any borough that they live in.

This significantly reduces the options many families have and forces them to live in places that may not be appropriate for their family size. More concerning is that this may make it impossible for some families to find housing. There may not be enough housing options in many areas for these families to find anywhere to live at all.

Even if they relocate, many families will be unable to find housing. For example, if they moved to one community, they would find that there were already 17,000 people applying for housing in 10,000 units. They may need to be on a waiting list for a couple of years like many families in the United States.

There were slightly more low income houses than benefits claimants before this year. However, many families are seriously concerned about their futures as they try to find places to live in the coming year.

House Prices Continue to Drop

House prices have dropped 1.4% from March to April 2011, to 160,395 according to the Halifax index’s record. The said drop was due to the lack of confidence among homebuyers continued to weigh heavily on the property market.

Cash-rich buyers who’re outside of in-demand areas are taking full advantage of low mortgage rates thus, the market remains stuck in the doldrums.

Lack of forced sellers due to many existing homeowners who are enjoying low mortgage rates are putting a prop under the market.

According to Halifax even with the gloomy economic mood and austerity, measures start to take effect. Prices were seeing a “modest decline”, a tad slower when the housing slump hit rock bottom during the aftermath of the credit crunch.

On a three-monthly basis, it is viewed as a more secure measure than the volatile monthly figures which on April, prices were down 1-4%.

According to Martin Ellis, Halifax housing economist “ Weak confidence among households, partly due to uncertainty over the economic outlook is constraining housing demand and resulting in some downward movement in prices.”

A relatively low burden for servicing mortgage debt and increased figure in employment are the likely to be providing support for the house prices, curbing the pace of decline are the signs of a modest tightening in housing market conditions.