HOUSE PRICES IN LONDON AND THE SOUTH EAST HAVE FURTHER TO FALL SAYS DAVID LAWRENSON OF LETTINGFOCUS
November 2009.
Sometimes what you see with your own eyes can be more useful than all the economic news you read. Here is an example.
So busy was the city centre of the Welsh capital 3 weeks ago that I commented on a recent blog post about how no one seemed to have bothered to tell the people of Cardiff that a big recession was all around them.
Meanwhile, back at home my weekly car trip across London seems to get faster all the time and getting a seat at a restaurant in Canary Wharf is now simplicity itself.
Confusing eh? But this difference is really not surprising at all because the recession (and any associated fall in house prices) is hitting much harder in London and surrounding areas than anywhere else in the country.
REPORT CONFIRMS ITS GRIM DOWN SOUTH EAST
Now we have hard evidence.
A recent report from the Local Government Association (LGA) said that workers in London and the South East are likely to be worst hit by the recession, with one in 12 jobs being cut in the next 18 months.
London suffers because of its dependence on the financial sector, where banks like Citi are shedding thousands of jobs. Many construction firms are also based in and around the London area.
According to the report, parts of the South West and East Anglia, with big farming communities, will only see one in 30 jobs disappear by 2010 with Plymouth and Cambridge the places least likely to see job losses. Stoke-on-Trent and the areas round Newcastle are also predicted to not do too bad either.
To some extent this is a repeat of the last big slowdown as London’s performance in previous recessions was worse than other parts of the country. As a result, London saw the biggest house price falls in the period from 1989-1994.
LONDON HOUSE PRICES HAVE FURTHER TO FALL
I have been amazed at how asking prices for property in London have been so resilient so far– and it is only now that I am seeing realistic pricing coming through from vendors, as reality, in the shape of redundance notices begins to strike.
This trend to more realistic pricing was also picked up by the website, Rightmove’s recent analysis too. (As you may know from other blogs I have not bought in the capital for 5 years as I think most house prices are way too high.)
For these reasons, I think London residential property prices will possibly drop another 8-10% from here whereas other areas may be close to the bottom already.
Areas that will also hold up well are places where there is a large proportion of people working for the government.
Whereas private sector workers (most of whose pensions are linked directly to the stock market) should make sure they are seated down before they open their next pension statement, government workers whose pensions are paid by future taxpayers won’t need to worry.
And neither will they be as worried about losing their jobs as the government will not want to make the dole figures any worse.
USE YOUR LOCAL LIBRARY
I stumbled across two magazine at my local library which should make good occasional reading for anyone looking to buy into areas that will do well in the future. One is “Regeneration & Renewal” at http://www.regen.net/. The other is “Modern Railways” which is packed with news on the latest new railway building. Use both to tell you where to buy to take advantage of coming improvements to infrastrucuure – a big factor in house price appreciation once the credit crunch eases.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of LettingFocus.com - the landlord and property letting advice experts.
I’m the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property title - Buy Successful Property Letting - How to Make Money in Buy to Let.
The new edition is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on sale and rent back.
I’m an expert freelance property writer, property speaker and I run this well known property blog
I contribute to newspapers and a host of property websites, write a number of columns in the press and I provide general property letting advice for anyone looking to buy property for themselves or to let out.
In my work as a consultant I help private individuals with any aspect of buying property or buy to let. What’s unique about lettingfocus.com is that we are independent property investment advisors because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.
We simply give one to one unbiased advice and are often asked to evaluate other property investments.
In my corporate consulting role, I also advise banks, building societies, housing associations and web portals with their buy to let and property products and services.
You can read more of my blog & find details of my networking, advice and property training programme at my website.Copyright: David Lawrenson 2008. This blog is updated once a week.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
It’s easy.
Go to the bottom of this post, and click on “Link to this post”
Our home blog page should then open & you should then see my smiling face at the top. Then page all the way down and on the bottom right it will say “Site feed” - click there and away you go.
You then just copy the link that comes up into your News Reader or News Aggregator. Even a non techie like me managed to do all this.
Please note if you have a website & are thinking of reproducing material here - that’s fine but we DO require the full links shown in each blog to be included including also the links in the section “
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON”
Please Contact Us button at our main site http://www.lettingfocus.com/ if you have any queries about this.
Sometimes what you see with your own eyes can be more useful than all the economic news you read. Here is an example.
So busy was the city centre of the Welsh capital 3 weeks ago that I commented on a recent blog post about how no one seemed to have bothered to tell the people of Cardiff that a big recession was all around them.
Meanwhile, back at home my weekly car trip across London seems to get faster all the time and getting a seat at a restaurant in Canary Wharf is now simplicity itself.
Confusing eh? But this difference is really not surprising at all because the recession (and any associated fall in house prices) is hitting much harder in London and surrounding areas than anywhere else in the country.
REPORT CONFIRMS ITS GRIM DOWN SOUTH EAST
Now we have hard evidence.
A recent report from the Local Government Association (LGA) said that workers in London and the South East are likely to be worst hit by the recession, with one in 12 jobs being cut in the next 18 months.
London suffers because of its dependence on the financial sector, where banks like Citi are shedding thousands of jobs. Many construction firms are also based in and around the London area.
According to the report, parts of the South West and East Anglia, with big farming communities, will only see one in 30 jobs disappear by 2010 with Plymouth and Cambridge the places least likely to see job losses. Stoke-on-Trent and the areas round Newcastle are also predicted to not do too bad either.
To some extent this is a repeat of the last big slowdown as London’s performance in previous recessions was worse than other parts of the country. As a result, London saw the biggest house price falls in the period from 1989-1994.
LONDON HOUSE PRICES HAVE FURTHER TO FALL
I have been amazed at how asking prices for property in London have been so resilient so far– and it is only now that I am seeing realistic pricing coming through from vendors, as reality, in the shape of redundance notices begins to strike.
This trend to more realistic pricing was also picked up by the website, Rightmove’s recent analysis too. (As you may know from other blogs I have not bought in the capital for 5 years as I think most house prices are way too high.)
For these reasons, I think London residential property prices will possibly drop another 8-10% from here whereas other areas may be close to the bottom already.
Areas that will also hold up well are places where there is a large proportion of people working for the government.
Whereas private sector workers (most of whose pensions are linked directly to the stock market) should make sure they are seated down before they open their next pension statement, government workers whose pensions are paid by future taxpayers won’t need to worry.
And neither will they be as worried about losing their jobs as the government will not want to make the dole figures any worse.
USE YOUR LOCAL LIBRARY
I stumbled across two magazine at my local library which should make good occasional reading for anyone looking to buy into areas that will do well in the future. One is “Regeneration & Renewal” at http://www.regen.net/. The other is “Modern Railways” which is packed with news on the latest new railway building. Use both to tell you where to buy to take advantage of coming improvements to infrastrucuure – a big factor in house price appreciation once the credit crunch eases.
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
I’m David Lawrenson of LettingFocus.com - the landlord and property letting advice experts.
I’m the author of “Successful Property Letting” which for the last 3 years has been the UK’s top selling property title - Buy Successful Property Letting - How to Make Money in Buy to Let.
The new edition is fully up to date with all the recent changes to tenancy deposit schemes, HMOs, licensing, capital gains taxes and it has new sections on sale and rent back.
I’m an expert freelance property writer, property speaker and I run this well known property blog
I contribute to newspapers and a host of property websites, write a number of columns in the press and I provide general property letting advice for anyone looking to buy property for themselves or to let out.
In my work as a consultant I help private individuals with any aspect of buying property or buy to let. What’s unique about lettingfocus.com is that we are independent property investment advisors because unlike most people in the buy to let and property “advice” business we are not linked to a property company, developer, agent or bridging loan financier and do not receive commissions from any of these sources.
We simply give one to one unbiased advice and are often asked to evaluate other property investments.
In my corporate consulting role, I also advise banks, building societies, housing associations and web portals with their buy to let and property products and services.
You can read more of my blog & find details of my networking, advice and property training programme at my website.Copyright: David Lawrenson 2008. This blog is updated once a week.
WANT TO BE KEPT UPDATED WITH OUR LATEST BLOGS?
It’s easy.
Go to the bottom of this post, and click on “Link to this post”
Our home blog page should then open & you should then see my smiling face at the top. Then page all the way down and on the bottom right it will say “Site feed” - click there and away you go.
You then just copy the link that comes up into your News Reader or News Aggregator. Even a non techie like me managed to do all this.
Please note if you have a website & are thinking of reproducing material here - that’s fine but we DO require the full links shown in each blog to be included including also the links in the section “
ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON”
Please Contact Us button at our main site http://www.lettingfocus.com/ if you have any queries about this.
Labels: London house prices, property investor information, regeneration information, UK house prices
This entry was posted by lettingfocus, on
Wednesday, November 19, 2008.
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