13
Dec
2010 v 2011 ?
Ben Hudson of Hudson Moody reviews the property year and looks
forward to a steadier 2011.
Overall, 2010 has been an annus mediocris for estate agents. Or
to use a more contemporary cliché it has been a year of two
halves.
The first six months were rather good with the property market
getting into its stride early in the New Year. In retrospect it
looks as if all those people frustrated by the previous two or
three years of stagnated market just wanted to get on and move. So,
for the optimistic at least, it seemed for a while that the market
was on its way back. This certainly included sellers who saw for
the first time in years a market that was offering real choice and
opportunity. Prices were also making gains and in some areas
clawing their way back to 2007 levels. This came as good news for
sellers who quickly saw the chance to extract a little more from
their sale.
But – and there is always a but in property –
halfway through the year the mood changed. A negative pall hung
over everything. Rather like the cloud of ash from that
unpronounceable Icelandic volcano. Perhaps it was thought of a
general election. Perhaps it was the relentless news of austerity,
cutbacks and public sector layoffs. Perhaps everyone just wanted to
think about the summer holidays or the World Cup. Perhaps they just
grew tired. Certainly they grew tired of the lack of mortgage funds
and the lack of will on the part of lenders to provide any. The
lenders still say they will lend but in many cases the over-harsh
lending criteria has made buying difficult for anyone without cash
or a very substantial deposit and gold plated job prospects. So now
we are left at the end of the year with the lowest mortgage lending
on record and much of the country snowed in. Not such a good end to
a property year that had started so well.
So the big question now is what will happen next year? It is a
hard one to call. The snow will clear but the austerity and the
mortgage problems won’t melt away quite so quickly. Also, all
those over-optimistic sellers will have to re-adjust their price
expectations as the market settles once again. But with the UK
slowly climbing out of the economic crisis there are two things for
sure next year. The British public will be anxiously looking
forward to the royal wedding in April and the Olympics in 2012 and
this should be the catalyst to a steadily improving property
market.