Property Prices 4.1 Percent

Despite the forthcoming general election in 5 months time and economist’s predictions that property prices would go static in 2010, so far the opposite appears to have occurred. In fact, reports by leading lenders seem to suggest that property prices have annually risen by 4.1% during January overcoming their December declines of 2.2%.

Supported by rising buyer interest and a growing property shortage, property portals such as Rightmove have experienced an increased flux in interest throughout the last month.


Within their first week of January, Rightmove reported a 26% increase in page viewings with over 157.4 million pages being viewed by potential property investors…

One of the main factors Rightmove is contributing to this property price boom is the fact that sellers are now much more confident about asking for higher prices for their homes. After witnessing property price rises during the last 6 months of 2009, they no longer feel afraid to ask for more as they know the demand is there…

However, Rightmove does believe that these property price increases won’t remain constant throughout the year.

With interest rates set to rise and the government’s plans to introduce spending cutbacks to occur after the general election – these 2 elements could slow or even halt the momentum of property price increases, leading to static property prices throughout the remainder of 2010.

More than a million people aged over 50 are believed to be relying on increasing property values to help fund their retirement. Yet since the onset of the recession during autumn 2007 an estimated £27,250 is believed to have been wiped off the price of UK property values.

Even following the last 7 months which has witnessed property price increases of £15,000, this overall property loss has still severely dented pre-retirees plans to use equity release to boost their retirement.


According to popular insurance company Liverpool Victoria, more than 12% of over 50s believed so much in the capital growth of their properties that they have chosen to save less independently.

And as a consequence, many now face a reduced standard of living when they hit retirement..

Yet despite these property price falls, confidence still remains in the long term value of their properties.

Through the use of equity release - where money is taken from the value of their properties – many over 50’s plan to fund their retirement by taking money out of their properties.

However, consumer group Which? feels this could be a big mistake and should only be used as a last resort.

Expensive, inflexible, and more often than not designed to leave people with little equity to play with; property experts recommend downsizing to a smaller, cheaper property instead. Not only is downsizing easier but pre-retirees can instantly benefit from these profits.

Original Article

More About the Author

Fraser Stirling, Property Mentor Delegate

No matter what the media wants you to believe, property is still the only investment route where you can benefit from an asset that will NEVER go into zero value. Even when I was university I admired properties ability to withstand the economic elements and stay strong, even when other investment forms faltered or failed. X years on, I am now the proud owner of multiple property investments - one of which earns a passive income of £4,680 and my property portfolio is still expanding. Read more