Behind the headlines: What’s really happening in the property market?
August 10th, 2010 by claire.mitchellIt seems it is time once again for heralding the doom of the property market. This morning, the media is all abuzz with the news from RICS that house prices have fallen for the first time in a year. According to their latest housing market survey, eight per cent more surveyors saw a fall than a rise in July, and the only regions to see material rises were London and the North West. Cue the ‘return of the recessions’, ‘double-dip fears’ and ‘house market stalling’ headlines.
Yes, it does sound like bad news, but look behind the headlines and you will see there’s a little more to it. Most importantly, the supply of properties has surged. As the laws of supply and demand dictate that stock going up will drive prices down in the short term, perhaps this explains the price falls?
And more importantly, an influx of stock coming on to the market is also a good indication that things are finally starting to return to a normal, post credit crunch way of life.
Some figures are in fact going in the right direction (but good news doesn’t make good headlines), particularly in the Prime market. Our July Prime Index (which is based on asking prices and looks at two tiers: the top 10 per cent and top 25 percent of the UK market) shows top end prices are up month on month. Regionally the top tiers are doing better too – seven of the ten UK regions saw price increases in July. Read the July Prime Index for the full details.
And find out more about the truth behind the property headlines on the Findaproperty.com blog.
August 19th, 2010 at 9:59 pm
The fact that there are loads of sellers and virtually no buyers, suggests that estate agents are keen to manipulate asking prices upwards – going against market trends.
If sales don’t materialise within an acceptable timescale, this is a clear indication that sellers are skewing the market, thus causing its stagnation.
If asking prices were reduced, buyer-interest would be stimulated, without necessarily affecting the price the market would ultimately pay.
What good market operators should never loose sight of is the fact that the market will only pay what the market can pay.
August 21st, 2010 at 3:27 pm
I think we have to face facts that most property is still overvalued when compared to salaries and disposable income. I think property prices in the next few years will continue to fall but it is what is needed to allow prices to return to a sustainable level.
September 3rd, 2010 at 2:10 pm
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