It’s a well-known fact that property will always make UK headlines.
As a nation, we have become obsessed with property prices – watching back-to-back property shows on TV, gazing through estate agent windows and endlessly scrolling through popular property websites. In fact, according to research conducted by Direct Line Home Insurance, 63% of Brits admit to perusing property websites even when they have no intention of buying. (1)
So with property prices forever at the forefront of people’s minds, it’s unsurprising that the media continue to focus their headlines on one of the nation’s favourite subjects.
Predominant headlines intent on seeding panic
There’s no denying that it’s been a bit of a bumpy ride for the property market recently, and with the changes to stamp duty last year and the vote to exit the European Union a couple of months later, it’s clear that a sense of uncertainty has settled over the market.
However, our obsession with property has allowed the media to use scaremongering tactics to grab our attention with headlines reporting property market CRASHES, price DROPS and a housing CRISIS. The recent predominant headlines appear to be intent on alarming people and seeding panic, rather than considering the facts in their proper context.
Looking beyond the headlines
So let’s look at these negative headlines more closely…
While there have been some reductions in house price growth in some areas of the UK, in general, UK growth over the last 12 months is still in positive territory.
Yet we’re continuing to see panic-ridden headlines like this recent article in the Express: “Property crash: A THIRD of UK properties for sale drop in price by £25,000”. The insinuation was that the UK property market is “crashing” with more than 30% of listed properties seeing a reduction in their list price. Whilst we agree that a £25,000 price reduction does grab your attention, what is the underlying house price in question?
An article published by Property Forum (2) examines this statement and comments that for a £1 million house, a £25,000 reduction is just 2.5% and for a £2 million house the reduction is just 1.25%. However, a 2.5% drop in the list price for UK houses does not grab the same attention with readers as a £25,000 loss in the pocket.
What’s more, all of the areas mentioned as being impacted by the “crash” are located in and around London – an area where we know prices have slowed in recent months, but also an area which has performed exceptionally well over the last decade. Therefore a £25,000 reduction is neither here nor there in the context of the long-term picture. We couldn’t agree more!
The true picture for August
So although the price of property coming to market may have fallen by 0.9% (-£2,758) in August according to Rightmove (3), it’s important to look at this in context. A price fall when the summer holiday season is in full swing is not unexpected, with both buyers and sellers having holiday distractions. Indeed, this drop is very much in line with the average for this time of year, which has been -1.2% over the seven years since 2010. So whilst the summer holidays may have had a dampening effect on the housing market, we should expect this to pick up again in the coming weeks.
The simple fact is, for the press to report that August has performed in line with the average for the past seven years does not make for sensational headlines, whereas losses of £25,000 will undoubtedly drive up readership. So, we simply ask you to always consider the context of an article.
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