PROPERTY CRISIS: Warnings emerged online
WHILE the media has reported the collapsing housing market in mostly negative terms, on the internet many have been greeting the rapidly falling prices like a long-lost friend.
Many of them are from the hordes of people who during the last decade have increasingly abandoned hope that they would ever be able to afford their own homes.
Not just young people or those in poorly-paid jobs, but middle-ranking professionals earning well above the minimum wage, some turned to the internet to question the sustainability of a property market where those refusing to be saddled by cripplingly huge debts were shut out.
Looking at previous property bubbles – none of which had reached the giddy heights of that just past – and studying how far removed average house prices had become from average earnings, they decided that the boom would certainly turn into a very serious bust.
Their arguments were fundamentally simple. So simple that they were mocked as "Jeremiahs" while the market continued its epic ascent.
But as intensifying global economic turmoil – partly responsible for plummeting house prices, partly caused by them – those arguments appear increasingly profound.
During the first half of last year, as experts and estate agents were urging people onto the housing ladder, the collection of dissident economists, renegade anonymous estate agents and aggrieved would-be first-time buyers on websites such as housepricecrash.co.uk were warning anyone who would listen to get out of property.
At that time, as prices soared towards their zenith, the experts were making very different pronouncements. One property correspondent said in April 2007 – just as the boom was about to end: "But the big question is: where will it all end? In my opinion, not this year and probably not the next...house prices are inevitably on the up."
They were far from the only ones, as herd instinct took control, but on the web other experts were emerging. Now some of the leading figures behind the internet scepticism are quoted extensively by the world's leading financial journals.
It is difficult to quantify the role that the internet is playing in the property crash. But as prices continue their descent, it is likely that more prospective house buyers and sellers will shun estate agents' advice in favour the websites which had predicted the wreck.
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Tuesday 29 May 2012
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