Should we take some comfort from this story from the Times? It seems that it hard-pressed middle class home-debtors won't be the only ones taking a financial bath from the housing crash; the undeserving rich might also take a caning on property prices.
Somehow, I think the rich will be disproportionately affected by this crash. In London, especially, prices went up higher; therefore, prices have further to fall. Once the "housing as an investment" myth has been firmly dispelled by a couple of months of declining prices, the wealthy "investors" will cut their losses and sell up.
Just watch, the percentage losses in London will be higher than anywhere else in the UK.
Feeling the squeeze?
At the top end, the experts are cautious but confident, reports Paula Hawkins
THE RICH may be different, but that does not make them immune to a downturn in the UK property market. “Anyone who thinks the current credit crunch is going to have no effect has their head in the sand,” says Charlie Ellingworth, of Property Vision.
Savills reports that weaker financial markets are already leading to a cooling of the performance of prime Central London property, with growth levels under pressure for the first time since 2005.
This sector of the market is not insignificant. While the vast majority of UK property bought and sold is valued at less than £300,000, the number of £1 million-plus sales has risen threefold over the past five years, with more than 6,100 such properties sold in the year to June 2007.
Not all prime properties are vulnerable. “Rare products will continue to hold their own,” says Jonathan Hewlett, of Savills’ Sloane Street branch, but he reports a change in temperament in the market. Buyers are a good deal more cautious, and sellers have to adopt a less bullish approach. “A sense of reality has been brought back to the market,” says Jeremy Lambourne, of Oakhall Property Source.