Tuesday, March 16, 2010 by Ed Mead
Having had so many unknowns plaguing any form of forecasting over the last few months it might just be that good old Spring might yet ride to the rescue and perhaps implement phase 2 of this unlikely property recovery.
Phase 1 was as unexpected as it was powerful, and in thirty years there’s not been a more aggressive turnaround. Most reasons have been discussed ad nauseam but there’s little doubt that over valuing by desperate agents and sellers finding nothing to move to is causing the “recovery” to stall. Agents aren’t rocket scientists and are just as prone as anyone else to thinking everything’s sorted. It’s tempting to agree, but if anyone thinks we’re back to the sunlit uplands they’ve quite possibly got another think coming. Doom mongers still outnumber the Bulls.
If this stall is as quick a down as the recovery was up then it’ll make for a new ride at Thorpe Park. I simply don’t believe that there are only a finite number of Italians or that the banks HAVE run out of mortgage funds (although that’s the more likely of the two), and watching politicians trying to avoid telling us how they’re going cut services and increase Taxes post election surely gives the lie to why you’re better selling now, we’ll all be suffering later.
Having said that, the one thing that is set to stay is the lamentably low level of transactions we’ve been seeing over the last few months. Our records clearly show that supply of new property is at pretty much an all time low, a fact borne out by the low level of mortgage advances in February. The feel of the last few days has been nervy and as an agent who recognizes the importance of spreading property market largesse around to the benefit of the wider economy unless we see action to help people move, like Stamp Duty Land Tax reverting to 1% across the board, I fear this will have serious implications.
However demand is holding up, and is well within usual tolerances for this time of year and so on that basis you should see prices continue to ease upwards.
Still, bearing in mind the tediously cra**y weather we’ve been having even a penguin would have given up and waddled off in search of warmth, hopefully when they come back they’ll be clutching mortgage offers and chequebooks.