Guaranteed rent the solution to a double dip recession?

Loss of jobs, is banking on the edge and recession knocking on the door. Sound familiar? For anyone who lived through the global financial crisis in 2008, it is hard not to experience a feeling of déjà vu in the last week. For homeowners and agents to increase the double-dip heads the specter of further property price falls. For first-time buyers, they offer a glimmer of hope at last the first rung of the ladder frame.

A booming ten years has doubled in the average real estate prices more than in his tracks stopped in 2008, as buyers and banks reeling from crippled credit markets, the second collapse of Lehman Brothers and the British interference in the deepest recession since World War II.

Then came a steady 2010, but falling prices again this year. With so much wind, now the question of whether house prices continue to fall, but how fast and how far to drop. The UK is heading for a crash like that which destroyed entire neighborhoods in the U.S.? Or will it be a soft correction?

There are far too deeply into data: Property market surveys are thick on the ground, and although they are often contradictory, in recent months, the downbeat message almost unanimously.

In the past two weeks, Halifax and Nationwide both reported compared to property prices fall, whereas the data from the Land Registry, sales in June is an annual 13%, had begun before the euro-zone financial crisis ever to bite.

Property data company Home Track fueled fears of more falls as its latest survey of England and Wales showed a decline in new buyers in the market. He said, fell for the 15th consecutive month in September.

For Agent Adam Shea, co-founder of the Pickwick Estates chain in south London four years ago, the parallels with the last drop-off are already present.

“When we come back after an evaluation of potential suppliers, about half the people choose to stay or a new kitchen or bathroom to expand,” he says. “People are in the mindset of the investment in their existing house and reminiscent of 2008.”

But he says, buyers will find it easier to get mortgages at this time. Pickwick, unlike most economists predicted a flat year for prices in 2012 and has just opened two new branches – albeit in a City of London market and international monetary bouyed.

Outside London, there is another important factor that will avert a US-style crash, says Kevin Hollinrake York agents. Demand remains high compared with the offer, says the CEO of the 140-strong chain of hunters. “If you watch the news, you’d think that the weather in 2008, but it has not scare any buyer. Sale of a consistent and volumes at the same level as last year,” he says.

Economic problems such as job security and the euro-zone problems in people’s minds, but they should still be at home, he says. “We have an office in Middelburg, where you have had steel plant closures, but the market is doing OK. If people do not want to buy, they will be hired.”

Yet the number of brokers in the UK almost halved from 16,000 at the height of the market in 2007 to fewer than 9,000 now, says research director Richard Donnell Home Track.

The echo of a fall in transactions of 1.25 mA average year in the ten years to 2007 to less than 700,000 in 2010. Home track predicted that prices have fallen by 2% this year and will again fall at the same rate next year.

Donnell said that the economic backdrop is alienating both buyers and sellers. By his calculations, could afford to 14m households, move or not to fight to get a mortgage – 8m 6m own home without a mortgage have a mortgage of less than 50% loan to value. But the cost of moving is priceless.

“Mortgage application costs are higher, the cost of new mortgages is often higher, there are the direct costs of the movement as stamp duty, people tend to spend money on a new home too,” he says. “Staying put is the obvious thing to do.”

Looks may not always change quickly, said Howard Archer, economist at IHS Global Insight. The prices are measured by 19.3% compared with the high in the summer of 2007, with the Halifax, and they have to fall further, he says.

“We suspect that suppressed the purchasing power, a tightening of fiscal policy, a weakening labor market and concern about the economic outlook, potential buyers and maintain the roads on house prices,” he says, adding that outweighs these factors and problems in the banking system does not support the extremely low interest rates at 0.5%.

However even Halifax reported that repayments for new borrowers at their lowest level for almost 15 years.

Mortgages but not much cheaper if you do not deposit to lift or no income to cover repayments, says Ed Stansfield, property economist at Capital Economics chief. “If you work, you take away pretty much lose all the benefits of low prices to do,” he says.

The think-tank predicts that after a decrease of 3% this year, prices 5% in 2012 and 5% decline again in 2013.

Providers should take note, says Richard Girdwood at the Morpeth branch of estate agent Strutt & Parker.

“There are a lot of” my neighbor’s house sold in 2008 for this “, but they must have been the current market,” he says. “When a property is not favorable competitive position will sit on the market.”

To get an idea of ​​where the prices really are, we look back much further than the last few years or even decades, said Neil Monnery, author of Safe as Houses?, A History of house prices. His research suggests that fall on the British market.

“House prices, when considered over a longer period of time, tend to rise to 1% above inflation. In Great Britain in the past 15 years have grown from 5% per annum in real terms on … some point, prices in the UK Back to Trend. But there are several ways to go. ”

He does not see an American or Irish-style crash, but, but – thanks to low interest rates – rather than some sort of pattern in Japan, where prices every year cases for 20 years.

“The market should be and whether it is possible we can in a reasonable manner, without pain, and where prices are at a point where young people are better able to easily buy.

“In that sense we have a very rosy scenario.”

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