The housing market remains in a state of weakness and it is estimated by some experts that it will remain that way throughout all of next year.  That is probably not what homeowners want to hear if they are hoping for a quicker recovery to begin building their equity.  For many homeowners the lack of equity is what is standing between them and a low interest rate remortgage.

According to the estate agency Knight Frank the level of house prices seen before the credit crisis will not return until 2019.  Other experts believe it may be even longer.  The reasoning may not be so much the lack of recovery but that pre-credit crisis house prices were considered over-inflated to start with and a healthier housing market will reveal much lower pricing on properties.

Gráinne Gilmore, head of UK residential research with Knight Frank, remarked, “In the wider economy, there is more austerity to come. George Osborne, the chancellor, is being pushed hard for a fiscal plan B, but so far shows little sign of deviating from the schedule of public sector cuts which will continue well into next year and 2014.

“In fact, we do not see average prices reaching their 2007 peak again until 2019 – which would mark the longest period between price peaks in more than sixty years. Once inflation is stripped out, average UK house prices are unlikely to hit 2007 levels again in real terms until 2031.”

Current low interest rates are hoped to bring out more first time buyers to unfreeze the property ladder.  Demand for mortgages is low considering the low level of interest rates but there still remains a problem in hopeful home buyers obtaining their deposits.