The mythical buyer - 21 August 2008

Posted by Paul Collins No comments

The media are accused of being responsibile for a disproportionate amount of bad things that happen in the world, from stirring up tensions on issues like race and immigration, to fuelling the latest property boom and ‘making’ people buy houses that they can ill afford.

While this is not intended to be a rant on the nature of personal responsibility and free will, no matter how much a journo might try to encourage a certain response from an individual, that person is still the one putting pen to paper on the mortgage application, sales contract, or agreement for another credit card.

At the same time, it behoves anyone who writes for public consumption to take some time to reflect on the influences and effects of their scribbles, and we can often find ourselves changing our opinion through thinking about how our words might be interpreted.

I was listening to a couple of business experts on the radio this morning discussing the state of the UK property market, given that Persimmon Homes, one of the biggest house builders in the country, is due to reveal that profits for the first half of this year have taken a huge battering in the economic downturn. Within a couple of minutes of each other, the two experts claimed on one hand that we are currently in a ‘buyer’s market’, while on the other hand that it is a very difficult and uncertain time for buyers. Clearly, something here doesn’t quite add up.

Now I will happily admit that I have, in the past few months, written the phrase ‘buyer’s market’ on more than one occasion. In many ways, I still stand by the idea that anyone looking to buy a property at the moment is faced with an almost unprecedented choice of houses and apartments on the resale market, and a bewildering array of offers for new-build homes. At the same time, this does not help the majority of people who are out there struggling to scrape together the extra money for a higher deposit since the banks tightened their lending criteria.

The fact is this: there is a buyer’s market in UK property for people who have already secured their finance, and are free to go out and arrange their purchase. For the majority of people, the housing market is much more of a distant reality at present, as they face a fight to get any kind of mortgage, or need to sell their current property in order to even consider moving. It boils down to a simple question: if it really is a buyer’s market, where are all the buyers?

While it remains important for the media to try to be positive about the prospects for the property market (I, for one, still have a huge amount of faith in bricks and mortar as a long-term investment), we have to stay in touch with reality. If the media continues to insist that this is a great time to buy a property, and that we should all be out there snapping up a portfolio, the public at large will lose all confidence in the advice and tips given, much of which is valid, useful and insightful.

Post this article to:

del.icio.us Digg Newsvine Reddit MyYahoo! Facebook

Keep blogs friendly, read our posting policy for guidelines.

Found an offensive/inappropriate comment? Please report it.

© Copyright Buy Associates Ltd

All circumstances vary. BuyAssociation provides general advice for guidance purposes only. It is strongly recommended that you seek professional advice before making any purchase.