House prices are being hit by pessimism for second homes, say estate agents
Property professionals have blamed the slowdown of the second home market for growing pessimism in the region's housing market.
The Royal Institution of Chartered Surveyors (Rics) said nationally eight per cent more of its members reported a fall than a rise in property prices in July – the first time the survey has recorded a fall in house prices since July 2009.
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While the market is slowing in the South West, the region managed to buck the trend as two per cent more surveyors reported price rises than falls. This compares with a net balance of 15 per cent reporting rises last month.
Rics said the fall came as supply outstripped demand, with a decrease in buyer numbers for the second month in a row while more sellers flooded onto the market.
Its July survey also indicated prices were likely to decline further, with the worst reading for expectations since last spring.
Rics said 28 per cent more surveyors forecast prices to fall over the coming months, up from six per cent in June. Pessimism was just as rife in the South West as 25 per cent of surveyors predicted a fall.
The survey prompted economists to argue that the public's fear over deep public sector spending cuts was hitting consumer confidence.
Agents in Devon and Cornwall pointed to a number of factors for slowing conditions.
Timothy Garratt of Rendells in Chagford, Devon, said: "Job security is affecting the market, with people staying put.
"The second home market has dried up. Interest from upcountry buyers is reduced, affecting the mid-to-top end of the market."
David Dark of Seldons in Bideford said: "Since the budget, the rate of sales growth has slowed. However, viewing rates are holding up well so we're confident that the number of sales will increase again. The increase in supply of available properties has made the market very price sensitive."
Jeff Cole of Cole Rayment and White in Wadebridge, Cornwall, said: "A rise in instructions coupled with some fear and uncertainty over jobs has affected confidence.
"This also comes with some of the media coverage and scares of a possible double dip recession."
But the report suggests the market will remain buoyant as eight per cent more surveyors said they expected the number of sales to rise rather than fall.
The Rics figures contrast with an upbeat report, also out today, from the National Association of Estate Agents (NAEA), which found the market enjoyed its strongest month of the year in July.
It said both demand and supply increased, with the average agent seeing 292 registered house hunters in July, up from 279 in June.
Lender Halifax also sparked cheer last week when it said prices bounced back by 0.6 per cent in July, reversing the slump seen in the past month.








19 Comments
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by Michael White, Brugge Flanders
Monday, August 16 2010, 6:43PM
“When are we English going to admit that sometimes those unspeakable foreigners can teachy us something. Here in Belgium, there is an extra tax upon houses not used as a residence. Think about it.”
by Timothy, Pz
Friday, August 13 2010, 3:09PM
“"Onan Hag All" you make me laff!
"The priority of the Kernow assembly, indeed its first priority, should be to take into public ownership all the houses by those who abuse our nations housing stock for pleasure."
Are you Stalinist or something? If not, presumably you would need primary legislation and have to pay billions in compensation, both equally implausible.
They say the difference between a Neurotic and a Psychotic is that the former build castles in the sky and the latter live in them. Which one are you I wonder?”
by Onan Hag All, Kernow, a proud nation
Thursday, August 12 2010, 1:41PM
“Calmer Waters speaks the truth. Kernow has all teh houses our nation needs!! The priority of the Kernow assembly, indeed its first priority, should be to take into public ownership all the houses by those who abuse our nations housing stock for pleasure. The should then be redistributed equitably to rightful and true people who can show they are Cornish nationals. We have an abundance of good housing stock here, more than our nations needs. But the illegal activities of the English Imperial State, who have no rightful permission to make laws in Kernow, have sequestered our houses away. Kernow Assembly should repossess our houses, kick out those who have desecrated Kernow¿s abodes as ¿second homes¿, and tax to the hilt anyone renting out a house for holidays!!!
Kernow Bys Vyken!!”
by Charles, Somersetshire
Thursday, August 12 2010, 9:52AM
“:| A 'Murphy's Law' that must always born in mind when ever purchasing property. . When prices are rising, people never seem to think they will ever stop going up, and conversely when prices are falling people never think they will ever stop going down. . . But they always do! . . "Life's a b*tch and then you die."”
by TimV, PZ
Wednesday, August 11 2010, 9:26PM
“@Peter B Wellington "The answer to all the housing/pricing problems is extremely simple, but no one will face up to it.
RELEASE more land for building."
Well it's not actually Peter! Builders will only build if they can make a profit. New houses are predominantly purchased and occupied by people outside the county because they can afford them. Just building more houses therefore is a double whammy - it uses up valuable agricultural land and puts pressure on the infrastructure, whilst doing nothing to assist those needing houses. It should be noted that the population of Cornwall is about twice what it was fifty years ago, with proportionately more houses, largely caused by inward migration. Yet there is still a shortage, rather proving the point.”
by Charles Henry 1945-(diuturnity), Somersetshire
Wednesday, August 11 2010, 6:10PM
“:| @David, St Austell
David your politics are showing a little; wrong boom, wrong decade. Historically property values have followed inflation and income levels over the much longer term. . . Expect property values to yet drop further because of the relatively low level of inflation over recent years (not counting property). . In the early 70's the value of certain property actually trebled in a very short time, but because of much higher inflation. . But when prices stopped rising, the prices achieved just plateaued for several years, but the REAL value was then actually dropping by about 10% a year in a slower market. . In my opinion, as selling a home becomes easier, history will repeat itself, and some people will just get out of the market and wait for the 'bottom', whatever that is. . Again in my opinion, prices for a really buoyant market probably shouldn't be much more than double they were in 1995/96, but there will be the usual variation because of location and desirability. . Best Charles.”
by Calmer Waters, The Celtic Nation And Duchy Of Cornwall
Wednesday, August 11 2010, 4:33PM
“With great respect, Peter, you are wrong.
There is more than enough housing to go round to provide shelter for everyone both in Cornwall and elsewhere in the UK.
How the plentiful and abundant housing stock is being misused/unused that is the issue.
Proper, efficient and environmentally sound use = no housing 'shortage'. Simple.
The relatively recent commoditisation and monopolisation of shelter for self-enrichment by an affluent minority is the root cause of the current inefficient use of shelter across the land.”
by Peter B Wellington, Wellington House Hotel, Falmouth
Wednesday, August 11 2010, 4:24PM
“The answer to all the housing/pricing problems is extremely simple, but no one will face up to it.
RELEASE more land for building.
Prices will fall to genuine "affordable" levels, and the property speculators will get their fingers burnt, which is as it should be.”
by Calmer Waters, The Celtic Nation And Duchy Of Cornwall
Wednesday, August 11 2010, 3:54PM
“Robert.
Who NEEDS more than one house? Nobody.
Here are the latest figures - probably an understatement - for houses in Cornwall 'owned' by non-residents:
North Cornwall ¿ 3940
St Austell and Newquay ¿ 1678
Truro and Falmouth ¿ 1885
Camborne and Redruth ¿ 1154
St Ives ¿ 3366
South East Cornwall ¿ 1832
Not an insignificant number - around 10% of Cornwall's total residential housing stock. The distribution leads to concentrations of up to 70% in some near deserted communities.
It's an appalling scandal. Not only do these anti-social non-residents punch holes in the fabric of Cornish society - they also inflate the cost of housing for the people of Cornwall in general. The people of Cornwall have to pay way over the odds to put a roof over their heads because of these social vandals.
There are around 1,000,000 houses in the UK standing empty.
THERE IS NO PROPER USE HOUSING SHORTAGE.”
by Robert, Camborne
Wednesday, August 11 2010, 2:15PM
“House Prices are dictated by market forces but not pure market forces. The planning pocess inevitably puts a constain on supply. This constaint benefits those owning homes outright and developers by allowing them to maintain a higher price brackets then would be sustainable in a pure market.
For anyone attempting to enter the house market or those who have a morgage to repay this is bad news as the affordablility of purchase ever since the mid 1960's has relative to wages become harder and harder. Now the banks have realised that prices are so inflated and have been stung so badly by lending up to every increasing morgage/wage ratios that without large % deposits which equate into trypically £c40,000 captial you can't get a morgage at all.
At the same time as a result the number of housholds unable to afford private housing and waiting on housing lists is 3.5million in England and rising.
While in Cornwall clearly second home ownership in St Ives, Padstow, Looe etc and many pretty seaside villages helps compound this it does not account for the majority of the problem. That is an urban myth. Who many second homes are there in Camborne. Redurth, Bodmin and St Austall etc.
To put it simply Lack of Supply due to market distortion from the Free Market is causing the problem and in Cornwall the situation is among the worse in the UK as wages are low and the desirable location is leading to an ever rising population of people moving her to live/work and retire as a PRIMARY not secondary residence. (just look at the General Census since 1951.)
So solutions are not easy. But lets address the real issues not urban myths: -
1. Rising population of permenant residents among the highest rates of increase in the UK.
2. Lack of supply to meet this rising population due to its speed and a constained market supply of housing not a true free market.
3. Low relative wages of local workforce relative to incoming retirement populations incomes when working upcountry.
4. No legal method to restain free movement of population into Cornwall.
5. Sever resistance from a vocal proportion of population against much proposed housing developement supported politically by parish and cornwall councillors.
SOLUTION?
I doubt one can be found on a LOCAL BASIS at all. If anyone can produce one which will not be based on ILLEGAL restiction of freedom of movement both under EU and Common Law and which would be on a LARGE ENOUGH scale and SUFFICIANTLY FUNDED that it would not automatically be drowned by local political oppostion I will be most intersested in hearing it.
But the moment any Government imposes a policy from accross the Tamar the protests will be heard from here to the moon.
Meanwhile what are those stuck on the housing register are in short term tenancies with not prospect of buying which is an increasing % of the Cornish Population going to do to have a home rather than a roof over their heads? Who locally is standing up for them and not simply playing lip service to the problem!”