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June 12, 2008    

Falling house prices - disaster or opportunity?

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by Gill Montia
Falling house prices - disaster or opportunity?

House sales may have ground to a halt, with the Royal Institution of Chartered Surveyors reporting that transactions are at a thirty-year low, but canny homeowners are nevertheless planning to take advantage of the market.

Research from Abbey Mortgages indicates that over two million homeowners see falling property prices as an opportunity to increase their assets in the long-term.

According to the lender’s recent survey, around 1.2 million Britons hope to trade up to a larger property that can be bought at a bargain price during the next 12 months.

Meanwhile 827,000 homeowners are prepared to sell before the market bottoms out and move into rented accommodation, buying again before prices begin to rise.

Around 1.1 million property owners hope to downsize and ride out the credit crisis and economic downturn with additional liquid assets.

Twelve per cent of those questioned had not yet adopted a definite strategy and were waiting to see the direction taken by property prices.

The remaining 67% of homeowners surveyed were content to stay put for the next 12 months, although 39% of this group were planning home improvements aimed at increasing space, their property’s value, or hopefully both.

Those determined to buy a new home in the coming year are prepared to wait 7.5 months on average, before making an offer.

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