Mike Cutler, partner with John Shepherd chartered surveyors, reflects on the current uncertainty in the residential property market.
It is unlikely that any single factor could have unhinged the UK residential property market while employment remained relatively high and interest rates were reasonably low. No single decider maybe, but a cocktail of negative factors is quite another matter.
There is no doubt now that a number of unconnected but highly adverse factors have conspired to bring the UK property party to a very abrupt end.
Until the summer the party was in full swing. Prices were steadily rising, people were taking ever-larger risks, banks and building societies were lending on record income multiples. Most partygoers were having a great time.
After a good party there often comes a hangover. Call it a correction in the market if you like, but now is the time for sober reflection.
The cocktail of factors that came with autumn was a mix of the sudden loss of confidence in the UK economy; a credit squeeze triggered by the US sub prime mortgage crisis; over-inflated prices and, perhaps, growing concern about a government increasingly playing off the back foot.
Home Information Packs (HIPs) have been another problem and are yet to prove to be the wonderful initiative the government promised.
This has come as no surprise to property experts. They advised against the plan all along.
In fact the property industry has geared up to the new legislation well and the public seem resigned to it. It is just a pity that many local authorities and utility companies are unable to fulfil their part of the bargain.
One local authority is taking, on average, 42 days to produce a search, and across the country 70 per cent of local authorities are taking seven days or more.
HIPs have also meant fewer properties coming onto the market. Perhaps the cost of a Hip has deterred chancers and the over-optimistic. Many estate agents would say this is no bad thing in the long run.
Whatever the reasons for change we have to deal with the market we are in, and good estate agents relish the opportunity to shine while other less experienced and unimaginative firms flounder.
Handling sales in this new environment is a challenge but solutions are there for those who accept the market for what it is and are prepared to be flexible. Some purchasers will be greatly looking forward to the benefits of a buyers' market for a while.
We have had a spiralling and abnormally buoyant market for four or five years. Now we have not.
It's not the end of the world but it is the end of the party.
* John Shepherd has offices in the West Midlands, Warwickshire and London Mayfair.