There are currently four signs on the front lawn of the complex where I reside (pictured). Three of these signs are advertising properties for sale within the complex, while the fourth one indicates that a property has been rented out by the estate agency displayed. Collectively, these signs give a surprisingly accurate snapshot of the credit crunch currently ravaging the UK economy and the rest of the globe.
Our residential complex has always been a popular choice for people working in the surrounding metropolitan area. It has a reasonably desirable postcode with good access to regional transport links. Two years ago, any property within the complex advertised for sale was snapped up within two months on average. This is no longer the case. In stark contrast, two of the three “For Sale” signs pictured above have been on display for almost TWELVE months to date. The third sign is a recent addition. Meanwhile, potential buyers are nowhere in sight. On the other hand, the “Let By” sign (also pictured) refers to a rental property occupied within just a month of advertising. Combine all these elements together and a bigger picture emerges.
Simply put, this all reflects the prevailing chronic shortage of mortgage finance products for prospective buyers in the UK (and beyond). The knock-on effect is seen in the sharp decline in properties changing hands in the marketplace. It is interesting to note that, in contrast, rental properties are in high demand as more people are forced to look for temporary accommodation. The subsequent domino effect is infinite – falling house prices, job losses, a decline in construction and other associated sectors, to mention just a few examples.
All indications suggest that the signs pictured above are likely to be a long-term fixture on our lawn. Click here for a BBC overview of a recent International Monetary Fund (IMF) report on the global credit crunch.
