house-and-home-kept-stable


Estate agents in London never really have too much to complain about, unless it's a lack of housing stock. London is so vastly short of homes that its prices will always top those in the rest of the country. In short, London property just can't lose.

But these days, the UK is teetering on the brink of a triple-dip recession. I know, I know, I'm supposed to be bleating on about buyers' confidence, growth in the property market and a surge in lending. These things are beginning to happen: mortgage lending for first-time-buyers was up 11% by the end of 2012, employment figures are higher than they've been since 1971 and Rightmove is reporting record hits this month. It currently ranks as Britain's 6th busiest website.

On a micro-scale, the Roy Brooks office has seen multiple offers on several properties and a surge of new buyers registering this January. There have been over the asking-price wars between buyers and impossibly busy Saturdays.

Isn't that great? Well, yes and no

Every year it's the same
Let's get a grasp on seasonal activity, there is a surge in UK internet search for property for sale and to rent every January - a real busting-off-the-graph kind of surge. That's nothing estate agents don't know already. Pre-Google, office phones would literally ring red-hot as soon as everyone's New Year hangover cleared. The property market always picks up in January and activity even increases-albeit on a smaller scale, in recessions.

The internet
It's also important to consider how people search online for homes has changed over the past 10 years. Since the UK's largest property portal began, (Rightmove started listing property in 2000), shifts in search mean a huge change in user behaviour. Today's buyers and tenants are more likely to begin their search at a property portal as opposed to a search engine. To put it another way: gone are the days when you would open Google and type 'buy a house in Camberwell.' You're going to open up Rightmove from your computer/tablet/phone.

Now think about the two points above. Basically, Rightmove have gained Google's users and report a seasonal trend every year. This year there is a remarkable amount of traffic, so why is this?

The reason people are moving has changed
Recent recessions now mean that people are selling up primarily because of the 'three ds,' - death, debt and divorce as opposed to up/down-sizing. A recent Rightmove survey implies as many as 7 out of 10 people intending to move this coming year are 'three d' dependent. How many of these are over-stretched mortagees or couples divorcing due to money worries?

The economy
UK growth is not meeting parliament's forecasts and business and industry is still struggling. More and more high street chains are entering administration and small businesses are closing down. Salaries haven't increased, fuel bills have risen sharply and many family-based benefits have been withdrawn, so people just aren't spending a lot of money in shops. Oh and the pound is a bit shaky right now too. Thankfully, with employment up, more people can get mortgages - particularly first-time buyers. Plus there's been an increase in lending. AND it's the New Year, where people resolve to make that move they've been holding off/saving for. This could explain a larger-than-recent surge in search. Online interest was only as high in 2008, just as the market bottomed out and before many, many mortgage products withdrew, lending tightened up dramatically and people lost jobs.

Booms and busts
It shouldn't come as any real surprise that slow gaining property prices result in stable market conditions. When the property market steams ahead too fast, it simultaneously spins too high. Before you know it, bang goes another property bubble. To put it simply: a bust will ALWAYS follow a boom. If we want a secure future, we need to steady the market now before it spirals out of control. Whatever you wish for, don't wish for another property boom.