Fluctuating predictions for the future of the UK property market in 2003 have left housebuyers nervous and ready to welcome seller's packs with open arms, research from Yorkshire Bank reveals.
And the bank says that the emerging need for greater assurance in uncertain times is also reflected in the numbers of buyers now no longer prepared to borrow to their maximum.
Its latest Housebuyers Survey of 2,500 adults nationwide has nearly nine out of 10 housebuyers (88%) saying they don't think the housebuying process is fair.
And the majority of housebuyers (85%) feel the introduction of a seller's pack could go some way to easing the buying process.
More than one in four people would happily provide buyers with a survey on their property now, if it meant they could speed up the buying process. And fewer than two in 10 housebuyers say they wouldn't trust a survey provided by the seller of a property to be accurate and true. Only 15% of housebuyers are actually against the introduction of seller's packs.
Geoff Greer, Yorkshire Bank's chief operating officer, says: “The possible future requirement by the government of a seller's pack is only in the very early stages – there are lots of pros and cons to be weighed up. We're not saying they could act as a panacea for all the problems of housebuying for a start, the current property market situation could be very different by then.
“But what our survey shows is a significant proportion of housebuyers are increasingly nervous and looking for ways to ease their precarious situation in the highly-pressured property market conditions, where overstretching and chains collapsing have become commonplace.
“While our survey finds current confidence in house prices at an all time high, with 64% of people anticipating the value of their home will continue to increase throughout 2003, some areas of the country, including the West Midlands and the North-West are showing signs of dwindling optimism.
“Currently gazumping can be a worry for house hunters, but with increasing speculation that the market is teetering, in some areas 'gazundering' may soon raise its ugly head.
“Whatever its other possible merits or shortcomings may be, it seems from our survey that the housebuying public welcome the intentions of a seller's pack. Being able to complete more quickly on a sale could ease the temptation for a seller to look for a higher offer if the market is rising and for the buyer to reduce theirs if prices are coming down.”
Yorkshire's first survey for 2003 also finds that one in four people are intending to move house in the next 12 months, but house hunters are beginning to show a split in their approach to buying.
More than one in seven buyers are still willing to offer over the asking price immediately for a property they're after and more than one in 10 remain prepared to 'do the dirty' on fellow house hunters and resort to gazumping to get their dream home. But concerns over ending up in negative equity if the market falls now find a significant number of buyers shying away from overstretching themselves to do so.
One in five (20%) of housebuyers say that they don't want to borrow up to their maximum to get a house in case they end up owing more than it's worth.
With Yorkshire Bank's quarterly survey also showing a 6% increase (from 55 to 61%) over the last three months in the number of people expecting interest rates to rise through 2003, it is perhaps not surprising almost one in three housebuyers think mortgage lenders currently offering them the chance to borrow many times their salaries are irresponsible.
When asked about freeing up equity in their home based on their current values, one in 10 people said they would be worried about how they'd pay it back if house values fall.
When thinking about what sort of mortgage they were most likely to opt for if buying in 2003, housebuyers have shown a shift of opinion since the last survey.
Flexible mortgages have increased in popularity at the expense of discount deals. One in five people would now opt for a flexible mortgage and more than one in 10 people wanted the option to make overpayments to clear the debt as quickly as possible. Indeed, the Yorkshire Bank survey found that the benefits of a flexible mortgage are more popular than the perceived simplicity of a standard variable rate repayment mortgage, with 25% of people saying they would consider swapping to a mortgage that offered the ability to pay it off years early.