Island Life Magazine Ltd August/September 2008 | Page 27

PROPERTY

Does the property market
determine the strength of
the economy?

life

Terence Willey

Contact: Mark or Terence Willey
Tel: [phone] or 875859
Website: www.terencewilley.co.uk

We are lead to believe that a
buoyant and strong property
market is a clear indicator of
a strong economy. However,
I subscribe to an entirely
different view as clearly
there are many factors which
determine the strength of the
property market. The rising
costs of buying and selling
houses is, quite to the contrary,
in my view entirely governed
by the prevailing economic
climate. The rising costs
generally of buying and selling
houses in terms of increased
rates for stamp duty, Search
and Land Registry fees and
the costs of providing Home
Information Packs must all
be taken into account. World
wide economics is relevant
again to the property market
in terms of the rising costs of
oil which has an overall effect
of increasing costs for new
build properties and in the
provisions of services generally
within the property industry.
In addition to all this I
believe that as the property
market reacts to such economic
climate the perception of a
depressed situation is quickly
spread. As we have seen
over the last few months the
media are quick to headline
falling sales, fewer mortgage
applications, negative equity
and increased mortgage
repossessions, all of which I
believe are a clear catalyst to

generate a lack of confidence
in the market. There has been
a steady increase in house
prices nationwide to such a
degree that it was generally
thought by Economists that at
some stage the “bubble would
burst” and we are now seeing
house prices return to a more
realistic level with purchasers
being able to re-negotiate and
Developers quite naturally
having to consider in some
circumstances selling off
plan rather than stock piling
completed properties.
Where the property industry
as a whole is affected by
such economics there are
inevitable casualties, in terms
of lost jobs, re-locations
and necessary changes in the
strategy of selling houses.
By this I mean Developers
offering new incentives, such
as part exchanges and equity
sharing deals to maintain a
market position.
I believe that Estate Agents
and Lawyers
should
similarly,
where
possible,
react to
assist the
general
movement
and stability
of the
market
and it

www.wightfrog.com/islandlife

can already be seen from
progressive and inventive
firms who have chosen to
assist both seller and buyer
in a transaction by providing
special fee arrangements and
products, all of which can only
serve to restore confidence
within the industry.
Like an individual who
suffers a nervous breakdown
the recovery period is, by its
very nature slow and must be
handled with care and I believe
that the property industry
within this Country is such
that it will make a full recovery
but it will depend entirely
upon those so influencing it.
For our part we will continue
to offer every support to
our clients in their sale and
purchase transactions.
For further details please
contact Terence Willey or
Mark Willey 01983 811222.
Or see our website
www.terencewilley.co.uk

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