21
Feb
Paul Twyneham assesses the first few weeks of property market
activity in 2009
Paul suggests that while the economic picture may be still
grave, local market activity in the housing sector is far from
moribund.
The shiny chrome pinball of bank failure still crashes around
the machine, ringing up eye-watering losses as it goes.
But each piece of negative news makes one fewer bad headline in
the future. This downturn will end, just as certainly as the Great
Depression of the 1920s ended. Already, in 2009, there are signs of
increased activity in the property market. These are not
‘green shoots’ – heaven forbid one should
announce that just now! But there are signs that people who have to
move are getting on with it. These signs also show that many
sellers have brought their hot price expectations more into line
with cold reality.
It is never easy for anyone to come to terms with a loss of some
equity in their home – especially those who have never had to
come to terms with this in the past. But before long the desire to
move on in life overcomes even the most steadfast seller when faced
with the proposition that getting on is better than holding on
– especially when what they are holding on to might still be
sinking. It’s rather like asking comfortable passengers on
the Titanic, before it hit the iceberg, if they would like to
freeze in an over-laden lifeboat and then asking them again after
the collision. Same question. Different answer.
We are living through a dramatic piece of economic history that
will be mentioned as much in the future as the Great Depression has
been in the past. Indeed, it is probable that the two events will
be forever linked as the classic examples of modern cataclysmic
economic and commercial breakdown.
But those of us living through such shattering events are being
forced to make decisions that few of our grandparents and great
grandparents ever had to make. Mass home ownership, we have all
learnt, can wear two masks – one of comedy and the other of
tragedy.
The media is often two, and sometimes three, months out of step
with property market news. Experts as they may be, news reporters
are not working day-by-day in the office of an estate agent, and
they are often the innocent mouthpieces of received wisdom.
Property statistics and trends do not have the immediacy of the
stock market, they take months to filter through and then distort
the up-to-date truth. Since the New Year estate agents up and down
the country have been describing greatly increased levels of
enquiry and property viewings unseen for over twelve months.
Nobody can say if these numbers will be sustained or even
increased. Much depends on how quickly that shiny pinball comes to
rest. But, meanwhile, there are sure signs that the house buying
and selling public are fed up with this recession, they are not
prepared to put their lives on hold while the governments in the
UK, or even the US, get their policies sorted out, or until the
banks get their house in order, or even until the price correction
ends and property regains its upward momentum.
Buyers are, once again, making enquiries, checking online and
visiting property. And why shouldn’t they be? There is great
choice, prices have come down dramatically and those with enough
deposit can enjoy the lowest interest rates for over three hundred
years.