April 2008

Amid varying reports on the market, it seems HIPs do have a use, after all!

Sir,

THERE seems to be so much conflicting information coming out nationally regarding the state of the housing market, with some institutions reporting that prices are rising and others saying they are falling.

In England we saw prices fall, on average, by about seven per cent between August of last year and January 2008. In America, when the prices started to fall, confidence was lost and panic selling set in, resulting in a crash.

This hasn’t happened here for two reasons: a) well-timed interest rate reductions and b) the roll out of Home Information Packs.

The interest rate reductions have helped return confidence to buyers but it is the HIPs that have really stopped the market from falling.

If sellers hadn’t needed a HIP, I think far more property would have flooded onto the market in January and February, causing over-saturation and therefore a continuation in price falls.
However, the amount of property coming on to the market so far this year has been way down on the normal levels and as old housing stock from last year starts to clear, we are finding that buyers have far less choice which, if it continues, will inevitably push prices back up.

If we get further interest rate reductions, we could see prices escalate rapidly. So HIPs do have a use after all!

SIMON WRATTEN,
Managing Director,
Fox Property
Newport,
Isle of Wight.