House price reports. This week news is out on what
everyone believes to be the catalyst for an emerging economy… House building
activity in London
and property prices. In our industry we’re peppered weekly by various sources
with information on house prices. Sometimes local, sometimes regional,
sometimes national, but when switching the television on to hear news
bulletin’s reporting house prices have fallen, alarm bells ring and the
attention is drawn. Apparently this reduction of 0.2% is narrowing the north
south divide. At that rate it could take a while to level out! Reporting a
house price on a national level applicable to all is just around the corner???
Unlikely. House price falls are set to grab attention and on both audio and
print versions the same tactic can be used to maximum impact, but the
underlying fact is house prices have fallen by just 0.2%. Take some
consideration of facts, sources, figures and abject calculating to determine
that in our view, but there it is 0.2%. In reality it is unlikely that house
prices in the South East will neither fall or increase, and if we look at the
wider picture house prices should be measured not only on a concentrated
regional basis, but also in terms of the property denominations. 0.2%!! Who
cares about that? So why don’t they just say house prices have remained stable
you may ask? The house price sources usually manipulate figures for it’s own
political interests and the media is like a powerful hypnotic like tool used to
control our thinking. There are different levels of house market. One bedroom
properties are more likely to be harder to sell as they require first time
buyers, against three/four bedroom properties for instance, which are in demand
due to lack of supply and are easier to obtain finance being higher up the
ladder. *There is 38% less property on the market than there was last year.
Families are more commonly relocating from region to region within the London
area (inside M25). A result of better transport facilities one reason. House
prices should be split into those markets, it really can be that that focussed
in the reporting. Take the postcodes of central London for instance, which is
boosted by the Russian and Chinese investors with their spare cash wanting to live
or invest in what is a trendy City with 100’s of sights and attractions, seeing
prime property as cheap. Totally immune to the rest of the London house market,
it’s own micro climate. Foreign investors lured by the lights and the promise
of economic recovery, because let’s face it we should be on the up by now,
because we’re ‘bumping along the bottom.’ Cyclical history proves it. What is
the driving force behind house price activity? Mortgages and finance, and there
is no indication of a recovery by the banks in the foreseeable future. The view
therefore should be taken that there will be no change in house prices for the
foreseeable future.
If you want to know about local market house prices speak to
your local Estate Agent. We do not charge for telephone conversations or visits
and you’ll get a good over view of what is happening in your area. Just make
sure you speak to the right person! J
**Source-National Association of Estate Agents
