Kevin Arlidge of Trenchard Arlidge foretells what will happen to predictions concerning the property market next year!
It is the time of year when some in the property game are tempted to look into their crystal balls and forecast what will be happening in the market in the year ahead. A quick look at how correct last year’s crop of predictions from industry spokesmen faired shows how dubious this practice can be. These outpourings won’t change anything and are pretty soon forgotten.
What really affects the market is confidence and that’s something that is impossible to predict. Confidence doesn’t come from an upbeat industry or government forecast. It creeps unseen and unnoticed into the national psyche.
Borrowing remains a trial for many and new home starts remain limited. We are at a forty-year low in private home ownership and we don’t know when, if ever, this will change. The national economy is more than ever tied to the behaviour of other countries and regimes that we have little or no control over – any more than we seem to have over our own financial institutions. There are so many unknowns today affecting the market - prediction is pointless.
Yet Trenchard Arlidge has seen better trading. Are homebuyers choosing to enter the market because national circumstances suggest they should? Hardly. It is because personal or family circumstances suggest they must.
Market excess is when discretionary buyers sense the opportunity for a significant short-term capital gain. A balanced market is when buyers need a property as a home first and perhaps a long-term investment second. Right now we are in a more balanced market. Some forecasts suggest that it will not be until 2019 when we regain the heady days of high property values that were encouraged before by delinquent lending. We should all be careful what we wish for. Twenty odd years ago we adopted the mantra that “homes are for nesting, not investing”. That didn’t remain true for long!