The Great Housing Market Debate
From our roving reporter - Malcolm McCallion
Put two housing market specialists into a room and they’ll argue bitterly about what’s happening to house prices and where transaction volumes are headed. Put four on a stage, populate the audience with similarly knowledgeable agitators, then sit back and watch the sparks fly … or at least that’s what you’d have thought. Yesterday, however, it didn’t quite turn out like that.
Martin Ellis, Chief Economist and ubiquitous housing market commentator for Halifax/Bank of Scotland was joined on the stage by Jim Pickard, bearish property correspondent of the Financial Times, Jim Cunningham of the Council of Mortgage Lenders and Richard Donnell, erstwhile Savills’ market guru who recently moved to Hometrack as Research Director. The meeting, called “The Great Housing Market Debate” and watched by the great and good of the UK property industry, was a fascinating insight into what the people who know are really saying is going to happen to the housing market, without the media’s screaming headlines.
Each had 15 minutes to pitch their case. Ellis, quoting liberally from his Halifax Price Index, said things were looking fine in general and were going be pretty steady in future. Pickard, who called the recent boom a “bubble” at every opportunity and was good value for his angry young man billing, said things weren’t all that great but there was still every chance that they were going to be pretty steady in future.
Cunningham, pulling lending data from the last two years and projecting two years hence, said things were not too bad and were going to be pretty steady in future. Not to be outdone, Donnell’s angle was that a headline rate disguised a multitude of regional issues but overall things seemed that they were going to be pretty steady in future.
What does this tell us about property market foretelling? That it’s not as much fun as it used to be, certainly. But also that the doomsayers and the cheerleaders have both had to accept that there’s not a whole lot of argument right now. This isn’t going to make you rush home from work to catch the news or dive into a newsagents and grab the latest edition but if there was a headline which captured the consensus on what’s going to happen going forwards you’d read:
Housing market “going to be pretty steady” say experts
You heard it here first.
Comments
Its not exciting but its the best news the property market could have. No more absurd increases and less and less fear of a damaging crash.
Posted by: Househunter | March 31, 2006 10:15 AM
I think you might be right. One of the comments made at the debate was that everyone says "Good news for the housing market!! Prices rocket!!" but is it really? What if you don't own a property? Then it's really bad news!
Much has been made of an impending crash - it's been discussed for years now - and yet it's not materialised. The fundamentals - economy, employment, interest rates - are sound so there really seems little chance of anything dramatic happening. It's just a balanced market with supply and demand roughly in sync at the moment - a much needed breather, really!
Posted by: Malcolm | March 31, 2006 11:09 AM
Truth is no one really knows. But what will happen is change! Like anything in life there is no certainty. It is just a matter of now. My opinion is that the market will move downwards as jobs are lost. Unlike our European brothers Britain has been kept safe by pilling on the debt both government and personal. I hope people who buy now will be happy that their children will be with them until they are 40. Good luck. If Britain hopes to be a success long term then reducing inflation is the priority to stop putting pressure on wages and this includes house inflation. 20 – 30 years is a long we live in a global economy which will get easier and easier to locate staff globally how will British workers offer enough added value to be worth 4 to 10 times foreign skilled labour – what will your houses be worth then. You can’t have it all ways. The future is the youth including your future but if your children can’t afford your house who will buy it. They also will not be able to afford your pension!
Posted by: steve | April 5, 2006 05:20 PM