There has been a lot of press speculation recently about the market and it seems that everyone has an opinion.
The Sunday Times on September 17 was proof, with page 3 leading with ‘House price crash expected’ followed by seven – yes, seven! – pages of ‘Market Special’ in the Home section.
The actual story covered the news that from 2,000 people surveyed, 53% think there will be a housing crash within five years.
This, the paper was at pains to point out, was from its own exclusive survey conducted by YouGov, which allowed it to pad out the Home section with items including how to take a property photograph and a comment article on ‘Why are we so obsessed with house prices?’ (Honestly, you couldn’t make it up.)
So with this startling statistic, a majority of 60 people from the 2,000 surveyed, thinking there will be a housing crash, Britain’s most prominent Sunday paper ran with a story on page 3.
Let’s consider who may have made up the poll of 2,000 (I could not find much in the way of detail in the paper itself).
Buyer position – If you are looking to buy, with no property to sell, ultimately you would love a price crash. So you might just suggest that a price crash is imminent: what’s the phrase, ‘wishful thinking’? Let’s also ignore the lending restrictions of the last four to five years tightening the affordability of the market, thus creating a much, much stronger foundation to the market than 2008 coupled with the dynamics of falling supply and rising demand in towns and cities.
Knowledge of the market – If you have a passing interest in this country’s media or watch the BBC news you would be forgiven for thinking we are always on the brink of some sort of collapse in the general swirl of negativity. Indeed, the BBC recently was moved to mark a ten-year anniversary of the ‘credit crunch’; I am sure someone probably baked a cake in the newsroom! Do other news stories get a ten-year anniversary? I can’t remember many.
Can we blame anyone for thinking in pessimistic terms when we are surrounded by such negativity over the media’s portrayal of business, property and the financial markets in the UK?
Location – If you are sitting in the Cotswolds (16.2% increase), or Kensington and Chelsea (13.2% increase in the market for the year since July 2016) you are going to have a different perspective on the market than somebody in City of London (8.4%) decrease or Pendle (3.4% decrease in the market over the same period) according to figures on the Sunday Times’ own website (not in the paper edition of the article).
The newspaper then highlighted the individual segment of a seller in Oxford who initially went on the market for £7.95m reduced to £6.95m and is now on at £5.95m.
Now I am in no way an expert on any specific market outside the London borough of Ealing, but according to the Land Registry only three houses have ever sold in the whole of Oxfordshire above £5.9m and I don’t think the newspaper was talking about Blenheim Palace in terms of quality of stock available.
Does it matter? Who believes polls anyway after the last couple of elections? However, it is mind-bogglingly frustrating when you are running a company with responsibility for the livelihoods of staff and their families that this sort of thing gets to page 3 of a major influencing source.
We, like all agents, face market questions all the time from clients. As agents this is where we should take the lead in handling the data minefield.
We also need to shout about our successes. Not very British, I know, but from our perspective, we point to the fact that our independent business has organically grown over the last seven years, is about to open its second office, that we are actively recruiting at present, and all of this is on the back of our success in the market.
We even highlight our competitors’ successes too, pointing to sold prices in the area.
We need to make our own noise in this market, and ultimately tap back into buyer motivation.
Is a softening market a bad thing? No, it’s not. For many buyers and those moving on it’s an opportunity to buy the lifestyle they want for less.
* Donald Collins is sales director of Go View London
The only thing that appears to stand in the way of a sustained, orderly, rise in property values are journalists denting any newly found confidence by homeowners.
Well that’s how it seems up here in the North West.
London is of course a completely different story.
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“The only thing that appears to stand in the way of a sustained, orderly, rise in property values are journalists denting any newly found confidence by homeowners.”
There has never been such a thing as “a sustained, orderly, rise in property values”.
Property values are chaotic by nature. The rules are there are no rules.
Even the supposed ‘rules’ – such as supply vs demand – do not have any real control or bearing.
If there WERE any rules (which of course there never can or will be…), then we would all be better at our jobs – because the job would be exponentially easier.
Wouldn’t that be better for your pals in Purple – because they’ll be among the first to shrivel and die in the type of market that many of us have seen come and go more than once.
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Would this be one of the polling companies that wrongly predicted a hung parliament in 2015 and a win for the remain side in the 2016 Referendum on the EU? And let’s not forget the pollsters’ prediction of a ‘Thumping Tory Majority’ in this year’s election?
However, I don’t agree that a softening market is a good thing. It should be, but the problem particularly with property is that it’s incredibly hard to sell almost anything in a market where people sort of feel that the price will be similar tomorrow, if not less.
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After the banking crash it was incredibly hard to sell with prices plummeting. However we still managed to sell enough to keep going. I learnt a lot of lessons in that period and gained huge amounts of experience. Whilst I don’t wish for those times again, I believe all the experienced gained before will stand us in good stead if the market slows significantly.
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AgentV
“Whilst I don’t wish for those times again, I believe all the experienced gained before will stand us in good stead if the market slows significantly.”
Only to a degree. Every time “those times” come round, the circumstances that bring them are completely different; you are dealing with a similar ‘problem’ – but with different causes and therefore different ‘fixes’.
Our job is to smooth out the waves wherever possible – but we can’t control the tides.
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