Cash Buyers are King in regards to House Buying in the United Kingdom. That’s what new figures from the CML (Council of Mortgage Lenders) are suggesting.

The CML started keeping stats for this sort of thing in 2005. In the space of 5 – 6 short years the amount of cash buyers has doubled.

The CML’s records began in  April ’05,  16,457 properties were bought by cash buyers. At bthe time, this was equivalent to 15% of the market.

Figures were crosschecked in January 2011, there were 27,600 properties bought by cash buyers, roughly equivalent to nearly 40% of the market.

These are pretty staggering statistics. It is no secret the average man on the street and small business owner are struggling like at no other time in recent times. There are not huge swathes of the population with large reserves of cash. Let’s face it, a property purchase is normally the biggest financial transaction joe bloggs enters into. The one for their home and almost always would require financial support in the form of a mortgage.

The problem is Banks are still not lending. Even after all the bailouts and Government and Public pressure. They have gone so far the other way from recklessly lending , to not lending at all, it is causing huge problems.

The demand is not as high as before for mortgage lending but it is the only way the average consumer can buy is through a mortgage.

Robert Bartlett is  the chief executive of Chesterton Humberts estate agency.

“In certain regions, the proportion of cash buyers will be even higher than these figures suggest,”
“For example, in south-west England, I would say it is probably more like 50 to 55%.

“In some areas of London, it can be up to 80%,” he adds.

Henry Pryor is an independent housing expert based in the UK.

Mr.Pryor’s view is that the people driving this trend are what is known as”the Saga Generation”

 

“They are downsizing and pocketing a profit from previous housing booms, divorcees benefiting from financial settlements and foreigners or expats returning to the UK,”

“Cash buyers are investing in property because they see it as one of the few investments which they can make money from and use at the same time.”

“Putting the money in a bank account may be safe, but you will get a woeful return on it, while stocks and shares look like the two ugly sisters – leaving property as the Cinderella of the investment world,” Mr Pryor says.