Samuels Says
Welcome to Samuel Says.
Each week Mr Samuels gives us an inside scoop on the issues that are happening at the heart of the industry. He will comment on the latest trends and all the rumours that are flying around behind closed doors...
Forecast #fails
Thursday 26th April 2012Brutal it may sound, but if they worked in the private sector, Mervyn King and his pals on the Bank of England's Monetary Policy Committee would have been given their P45s a long time back. Repeated policy failures, a lack of foresight about the biggest crash since the thirties and forecasts that are generally wide of the mark would have done for them. They talk in the language of high economics, but they have a startlingly low success rate. The latest forecast #fail came last week when CPI inflation, the Office for National Statistics revealed, nudged up 0.1 per cent, from 3.4 per cent to 3.5 per cent. For some time, the Bank has been adamant that inflation will be coming down each month to 2012, but as usual the economy is thinking different things to the Bank. With inflation proving far stickier than the Bank had predicted, it's surprising that MPC member, Adam Posen, announced late last week that inflation would still be back to target by 2012. That's a bold statement and one, if the Bank's track record is anything to go by, that will almost certainly backfire. Meanwhile, stickier than expected inflation will only weigh down on the property market, as it constrains consumer spending...
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Planning is the perennial thorn
Thursday 29th March 2012So, finally, the highly anticipated National Planning Policy Framework has been published. It's a shadow of its former self, having been slimmed down from 1,000 pages to just 50, but so far at least, it has had a far bigger — and more positive — impact. Indeed, it's a peculiarity of modern day politics when something proposed by one party is broadly welcomed by another but that's what has happened. My Lord, the Labour spin machine must have blown a fuse. Politics aside, what the slimmed down framework proposes is that there should be 'a presumption in favour of sustainable development', whereby planners and local authorities must balance the needs of the environment, local inhabitants and the local economy. In short, it's all about substituting common sense for bureaucratic red tape, which got out of control during the previous Government. Essentially, and these are the key concessions to environmental groups, the Government has said that brownfield sites should almost always be developed before greenfield sites and that urban sites should be developed before out-of-town sites (not great news for the supermarkets). Nobody wants to see the countryside tarmacked over, and the Government is right to put in place a framework that will avoid this. But at...
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Will the paralysis remain?
Wednesday 29th February 2012It's official. UK homeowners are insane. This is the only conclusion that can be drawn from the fact that, according to the latest Rightmove House Price Index, the average asking price of new sellers increased by 4.1% during February — the highest monthly rise since April 2002. So let's put this into context. Unemployment in the UK is rising, we're on the brink of a double-dip recession, the Bank of England is so terrified about the ability of the economy to cope that it's creating Monopoly money, oil prices are soaring, the Eurozone, our biggest export market, is on the brink of collapse, corporate insolvencies are going through the roof and the credit ratings agencies are looking ever closer at us with their beady eyes. So what do people do in a market that looks like it was dreamt up by Hieronymus Bosch? They whack up their asking prices and wait for the offers to come in. Which of course, they won't. Because so many people are scared stiff to buy right now — and certainly won't buy if the properties they are looking at are over-priced. OK, we all know that there are some properties out there that can still command a good...
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Consumer confidence hit hard in August
Monday 12th September 2011Looking at the latest data, the property market had a pretty dismal August – some would say dire. According to Nationwide, prices fell by 0.6 per cent during August, while on Wednesday Halifax announced they had fallen by double during the last month - down 1.2 per cent. Whoever you believe, what's clear is that the overall house price trend is down. There's definitely a sense, right now, that we're moving from 'flat' to 'falling' on the house price front. It's a fine line but it feels like August, which was one hell of a messy month for the global economy and markets, may have spelt the beginning of a further downward slide in house prices. Consumer confidence was hit hard, really hard — and when people aren't confident, people don't buy property. What's certain is that if the economy goes pop again, which many increasingly believe it will, house prices will almost certainly go pop with it. Unlike back in 2009, we're unlikely to have the bizarre situation this time round where house prices somehow defy the economy and actually rise during a recession. If anything, they're likely to exaggerate any dip in the economy. As ever, this is not necessarily bad news. We all know that...
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UK property market immersed in global maelstrom
Wednesday 31st August 2011The fate of the UK property market has surely never been so closely tied to developments outside the UK. It does feel, at present, as though we're getting immersed in a global maelstrom, which will decide our fate for many years to come. Just look at our two main export markets, Europe and the US, which will play an important role in any growth trajectory moving forward. Growth across the pond has pretty much ground to a halt while the eurozone, well, just where do you start? Last week's announcement that Germany, the engine room of Europe, grew by just 0.1% in the second quarter, is as good a place as any although this week's claim by the Bundesbank that euro bail-outs are illegal is the icing on the cake. After all, without bail-outs, in whatever form they come, you're bust. Meanwhile, back in Greece, it was announced yesterday by Finance Minister, Evangelos Venizelos, that the Greek economy will undershoot its already negative growth target by over a full per cent. And let's not forget Italy, which has a phenomenal debt mountain of its own and is, in the words of one analyst, "too big to bail". Is this really happening? Sometimes you have to pinch yourself to believe...
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