Here is the good news: the housing market is going to recover. And now the bad news: that recovery is not going to happen in the next 12 months.

Some pundits predict two years, some longer, but one thing looks likely: this autumn and next spring will see prices dipping and homes becoming harder to sell against a backdrop of public spending cuts, tax rises and a continued mortgage famine.

Don’t take my word for it. Ask the growing number of sellers trying to make their homes stand out and sell quickly in a market that is now characterised by too many houses on sale and too few buyers.

Stephen Squires is a retired farmer whose eight-bedroom modern-styled farmhouse near Okehampton in Devon has been on sale for two years through several estate agents. He is now advertising it online (www.tepilo.com, £1.5m) and is offering a £20,000 cash reward to anyone who introduces him to a buyer.

“I don’t want to spend another winter here, so it’s become urgent. We have had several people interested, but they’ve got the usual problem and say: ‘We can’t sell our current house’. So I’m trying something new to see if that works,” explains Stephen, who ran a marketing business in London before heading for the country.

Terry Jennings, an IT businessman, is pursuing a different initiative to sell his listed house in Buckinghamshire (£895,000, Cesare & Co: 01442 827000; www.cesare.co.uk) If a buyer pays the full price he will give them his 36-year-old Triumph TR6 – free.

“The house has been on sale for only a few weeks, but we recognise the state of the market. We’ve got to do something different to create some publicity,” Terry says.

In Nottinghamshire the seller of a modest four-bedroom house is offering a brand new Ford KA, or a discount of the same amount (about £8,000), to anyone who pays the £239,950 asking price (William H Brown: 01777 704248; www.sequencehome.co.uk)

Meanwhile, the new homes market is adopting similar strategies. Linden Homes is offering buyers the chance to have a free conservatory worth £10,000 when they buy in a development at Chinnor in Oxfordshire. And David Wilson Homes is including an annual rail and London underground pass, worth £4,760, for commuters buying flats at its Moove development in Banbury.

Most sellers, of course, adopt more orthodox marketing positions through estate agents’ windows and advertisements in the local papers, but there is growing concern that anyone selling now has to be quick before economic alarm bells ring.

Within the property industry the buzz is of nasty journalists talking down the market with tabloid tales about the twin spectres of public spending cuts and tax rises. But estate agents blaming the media should perhaps look closer to home, for their own colleagues are producing gloomy figures.

Firstly, there are the house price indices. In the spring, all seven major indices, including Rightmove and Hometrack, which rely on estate agents’ data, were showing monthly rises.

Now only two, the Land Registry and the Halifax Building Society, show even the smallest monthly price growth.

“You don’t need to be a fortune-teller to predict what cards a seller can play. Unless their property is a bit of a rarity, the only cards left read ‘chop the price’ or ‘spruce up the presentation’,” Miles Shipside, a director at Rightmove, says. His own index, based on homes on sale, shows asking prices have already dropped more than two per cent since early July.

Secondly, there are forecasts from estate agents’ own research departments. These are almost unanimous in ruling out a crash, but expect gentle falls this autumn and in 2011.

Savills has consistently been an accurate forecaster. It now says mainstream house prices will end 2010 some 2.5 per cent lower than in January with another one per cent fall expected next year. The company’s director of residential research, Lucian Cook, originally expected prices to grow in 2011. However, he admits his change of mind is due to property sales that are now running 20 per cent below even the miserly volume seen last year.

“Transaction levels have been lower despite a slight improvement in the availability of mortgage finance. This reflects faltering consumer confidence seriously undermined by the Coalition government’s policy of austerity measures,” he says.

Another leading estate agency, Knight Frank, agrees but blames over-optimistic sellers for making things worse. “The main complaint of agents is that houses are set to enter the autumn market between five and 10 per cent overpriced. With ‘asking-to-achieved’ prices currently at 95 per cent, the implication of this is that prices are likely to fall back by about five per cent before the year end,” Liam Bailey, the firm’s head of research, says.

He warns that with a combination of a higher volume of homes for sale, weak demand on the back of government spending cuts, rising taxes and weak income growth, the short-term outlook for the market is more challenging than it has been for 18 months.

Colin McKenzie runs C M Property Search, a buying service seeking out homes for busy clients and negotiating the price on their behalf. His advice to sellers who have failed to find a buyer over the summer is simple: cut your asking price by a fifth at least in a bid to draw new interest.

“Three or four months ago, with boundless optimism, your agent suggested an asking price. Since then not only have the prime buyers passed you by, but mortgages have become harder to secure and confidence has fallen away. Corner your agent. Discuss reducing the guide price by 20 per cent or more,” Colin urges.

Some vendors have taken his advice already. Zoopla.co.uk, a website marketing homes and monitoring their sales volumes and prices, says a third of the properties it advertises have cut asking prices. Another online service, propertysnake.co.uk, monitors rival property websites for reductions. It says that more than 215,000 homes currently on sale in the UK have lowered their prices by anything from two to 50 per cent.

But there are less pessimistic voices in the market and some estate agents say that certain areas are bucking the trend.

“Central London prices have slowed to a standstill in recent months and have stabilised at around 11 per cent below their 2007 peak. We are forecasting price growth of five per cent this year followed by three per cent in 2011,” Andrew Stanford of Cluttons explains.

“Don’t assume national statistics apply to the area and market level you’re trying to buy in. Always research locally,” is the advice of Nicola Oddy of Stacks, a buying agency in Cornwall, where many prices are remaining buoyant.

Interestingly, the Council for Mortgage Lenders says its previously pessimistic forecast of growing numbers of owners facing arrears and possible repossession is now not too bleak. “More people with short-term financial difficulties are able to get back on their feet,” a spokesman says.

So when will the storm be over? When can we start taking a more positive view of the property market?

Most analysts say 2012 will see some small growth in house prices in most regions of the UK. By then the strongest austerity measures will have been introduced and the London Olympics may produce a feel-good factor.

And when the turnaround really does occur, it may strike with a vengeance and even return to the large-scale price appreciation so commonplace before the credit crunch.

Research by Savills suggests that an inflation-adjusted rise of 40 per cent in house prices will occur by the end of the coming decade, as a buoyant UK encourages migrants and first-time buyers to get on the ladder again and push demand ahead of supply. So what goes around, comes around. The problem is, it may take some time.

TIPS FOR AUTUMN BUYERS AND SELLERS

For buyers

• Get your mortgage agreed as quickly as you can. It makes you look like a serious buyer and will give you an edge if there are rival bidders for the same home.

• Do your research. Use websites, visit during the day and night, make your own price comparisons with other homes on sale in the area.

• Make sure you present your offer clearly. List details of any chain, your mortgage status, solicitor’s details and moving deadlines.

For sellers

• Presentation counts. Rectify “barriers to purchase” such as unkempt paintwork or dodgy windows to deter low offers.

• Be realistic about pricing. Study recent sales of similar homes nearby and make sure your price is low enough to ensure many viewings – that’s key for a sale.

• The kitchen is the heart. Most buyers say this is a key room, so improve it before selling, but keep its style and quality in line with the rest of the house.

Telegraph

Most of us are still shaking the summer sand from our shoes but estate agents are already in autumn mode, with one question dominating all others: will house prices defy the wider economic malaise of 25 per cent spending cuts and imminent tax rises?

The prospects do not look good. The Rightmove, Nationwide and Hometrack price indices all show small falls over late summer, and the Royal Institution of Chartered Surveyors’ latest measure of sentiment in the industry suggests most estate agents believe prices are now falling.

London’s prices remain relatively strong, but falls are being recorded in almost every other part of England. A survey out this week shows a 3 per cent drop in prices in Scotland over the past three months.

The key forecasters, Savills and Knight Frank estate agents, predict prices will dip further by Christmas, and the house builder Bovis is warning of a “fragile” housing market with confidence sapped by a spectre of unemployment, spending cuts and tax hikes.

The worst problem remains a chronic shortage of mortgages. Santander, one of the biggest lenders, says 1.1m home owners tried but failed to sell in the past 12 months; most were frustrated by prospective buyers who were unable to secure a mortgage.

As a result of all this, many estate agents want sellers to cut their asking prices. Most autumn house sales are in September and October, after which vendors and buyers put plans on hold until the new year. That means there are just eight weeks to do the deal – exactly what Tracy and David Bliss want to do with their Somerset home.

They have cut the price tag of their four-bedroom converted barn at Holton from £895,000 to £800,000. They transformed the wreck into a home 10 years ago and at the height of the market hoped it would eventually sell at £1.2m – but not now.

“We put it on sale at £895,000 at the time of the general election but we’re anxious to sell rapidly and our agent (Palmer Snell, 01935 814531) has advised a price change. We hope people can see through the economic gloom,” Tracy says.

“We’ve painted the interior in neutral colours and we’re part of an open-house weekend in September when people can see the place for themselves,” she says. The couple, both recently retired, had many visitors before the summer but no offers as buyers were either unable to secure a mortgage or have been ultra-picky.

And with a glut of homes on sale – an estate agent typically has 55 properties on the market now, compared with 43 a month ago – buyers can afford to pick and choose.

“There are just over 900,000 homes for sale at present. New stock is being added at the rate of 4,500 a day,” says Henry Pryor of Housingexpert.net. “June’s and July’s sales were up by roughly 10,000 a month on 2009 but were still half what they were in 2006 and 2007.” He says the imbalance of stock on sale over the number of buyers registered with estate agents means there is only an 8 per cent chance of a vendor successfully selling their property in the next month.

Estate agents are particularly worried that buyers will be deterred by wider economic uncertainties and cuts in public spending. There are no official numbers stating how many homes are bought by public-sector staff but Savills says the figure is at least 15 per cent. Some areas are more vulnerable than others: in the North of England the figure is 24 per cent and in the South-west it is 23 per cent.

The key to kick-starting the market this autumn is to get more first-time buyers; this is particularly hard, with most lenders requiring deposits of £40,000 or more. Until far more first-timers enter the market to purchase the smaller homes of existing owners wanting to move, the lowest rungs of the property ladder will remain missing.

The Home Builders Federation (HBF) says first-time-buyer numbers in England and Wales are at a 35-year low. Those who succeed often have financial help from their parents but the HBF says the average age of an “unassisted” first-time buyer is now 37.

University lecturer Elisabetta Barone recently bought her first apartment at a scheme in Wembley, north-west London, built by the developer Quintain. Barone has lived in London for many years but can only now, at 39, afford to buy. She paid £211,000 for the property but even with that budget, she had to compromise on location.

“I’d been house-sitting for a friend in the Docklands but wanted to find somewhere for myself that was new and affordable. Despite falling prices in Canary Wharf, it was still too expensive for me,” she says.

But while estate agents are pessimistic about the short-term prospects, most of the property industry thinks the basic shortage of supply compared with demand will, in the much longer term, see prices go up.

Savills says that by next summer, the growth of the past 18 months will have reversed, leaving house prices at the same levels as in late 2008, some 15 per cent off peak values. But then prices will rise over a sustained period from late 2012 with 3 per cent annual growth. So by summer 2014, they will be back to the pre-recession highs.

The firm believes the only way that forecast will not come true will be if there is a sudden surge in new homes built to meet latent demand – and that is highly unlikely.

The Government’s new planning system – which has involved abolishing plans known as “regional spatial strategies” (RSS), scrapping housing targets and giving local communities a veto over new schemes – is already accused of worsening the housing shortage.

One prominent builder, Cala Homes, is asking the High Court to review the Government’s actions because they leave what the firm calls a “policy vacuum”. A 2,000-home Cala scheme in Winchester was recently turned down for planning permission, after years of preparation, because the strategic local plan had been scrapped days earlier.

This may be just the tip of the iceberg; the National Housing Federation claims plans for 85,000 homes in England have been dropped since the Government came to office.

“The uncertainty created by abolishing RSSs cannot be overstated. It’s going to take nine months before they’re replaced, if they are, and in the interim, almost nothing will happen. Even if new plans come into place, the delay will have set building rates back years,” says Andrew Thomson of BNP Paribas, which funds new housing.

So in the long term, we return to the old story – a growing population outstripping house-building levels. In the immediate future, however, the autumn skies are darkening. House prices, like leaves, are expected to fall in the coming months.

Top Tips For Sellers

* Get ahead of the price curve – a small reduction today may mean less of a drastic (and painful) reduction later.

* Photography is key – make sure the agent’s photographs are good and the best image leads the agent’s website and written details. This doesn’t have to be the front of the property, but could be a breathtaking view, a stunning kitchen or fabulous garden.

* Ensure your property is on with a proactive agent known to work hard.

* It’s obvious, but first-viewing impressions count: mow the lawn, polish brasswork, clean windows, clear clutter inside and complete any outstanding DIY jobs.

Top Tips For Buyers

* Don’t assume national house-price trends apply everywhere – carry out your own research on the internet and in the area where you are planning to buy.

* Make sure you have all of your finances in order and retain a good solicitor so you can act quickly when the right property presents itself.

* Present your offer seriously – show your finance, timescales and intentions to sellers, who will be reassured by your openness.

Source: Connells estate agency

Independent

The ongoing problems in the mortgage market, combined with concerns that house prices are falling again, have led to increased numbers of people looking to rent a home, the Royal Institution of Chartered Surveyors (RICS) said.

But despite interest rates being at a record low, making investing in property attractive, landlords are continuing to face problems getting a buy-to-let mortgage.

The group said this had led to the number of homes available to rent remaining low, with supply falling for the fourth consecutive quarter during the three months to the end of June.

Overall, 6% more surveyors said they had seen a fall in new instructions compared with those who had seen a rise, although this was down from 12% in the previous quarter. But at the same time, a balance of 26% of surveyors reported a rise in demand from potential tenants – the second consecutive quarter during which demand has increased at a pace above the long-term average.

The group said tenant demand increased across all regions of the UK, but was strongest in London and the East.

Unsurprisingly, the combination of falling supply and rising demand led to rents rising for the second quarter in a row, with 27% more surveyors saying the cost of renting a home had increased during the second quarter, compared with those who reported a fall. Going forward, a balance of 33% of surveyors expected rents to continue rising, with rents for houses marginally outperforming those for flats.

The group said the market was now very different to a year ago, when rents were pushed down by a flood of properties being made available to let after their owners were unable to sell them.

RICS spokesman James Scott-Lee said: “Supply of lettings property continued to fall in the three months to July although at the slowest pace in a year which, amid rising tenant demand, has helped propel rents higher for the second consecutive quarter. Existing landlords keen to expand their portfolio may still be struggling to access the necessary finance despite improved market conditions.”

Rents increased in all regions of UK, apart from the North, during the second quarter, while only the South West and East saw a rise in the number of properties available to let.

Copyright © 2010 The Press Association. All rights reserved.

LAP announces today that it has exchanged contracts unconditionally for the sale of its 65 year head leasehold interest in Antiquarius, located on Kings Road, London SW3, to Cadogan Estates Property Investments Limited for [pounds]17.82m. The property is let to Urbn Limited, trading as Anthropologie and McDevitt Corporation Limited, until 2024 at a combined rent of [pounds]1,150,000 pa. After a head rent of [pounds]68,640 pa this equates to a net initial yield of 5.74%. The book value as at 31 December 2009 was [pounds]17.0m. [pounds]12.75 million of the proceeds will be used to pay down a revolving credit facility and the balance will be added to cash reserves.

LAP was advised in the sale by Lewis & Partners and the purchaser was represented by H2SO.

 Ends.
 Contact:

John Heller, Chief Executive, LAP. Tel: 020 7415 5000

Baron Phillips, Baron Phillips Associates. Tel: 020 7920 3161

“This office suite in SW1 has the most popular characteristics that people seek in period offices; namely excellent floor to ceiling height and good natural light,” commented Colin Becker, Equity Director for MERJS. “The Grosvenor Crescent office suite also benefits from a separate meeting room, a fitted kitchen, passenger lift and self-contained WCs, so it really is an excellent office space for businesses looking to establish themselves in a very pleasant area of central London.”

When asked about location and transportation, Colin replied; “Grosvenor Crescent is an excellent location as contains a large garden square at its centre, so there is a great deal of greenery and many pleasant spaces for employees to enjoy in their lunch breaks. Hyde Park Corner Underground station is within close walking distance, so the Piccadilly line is easy to reach, and there are numerous bus services along Knightsbridge and Grosvenor Place. Oxford Street is about five minutes walk away,” Colin added, “so the local amenities are excellent. I anticipate a great deal of interest in this commercial property.”

About MERJS

MERJS is one of London‘s leading commercial property agencies, and is actively involved in selling and letting commercial property throughout Central London.

MERJS helps to identify and negotiate the most suitable office space to let for commercial tenants; including serviced office space requirements, refurbished offices in Central London, or a new commercial property development.

MERJS also advises a number of high profile organisations such as property companies, commercial developers, institutions and private commercial property landlords on acquiring and selling commercial investment property for sale. This involves access to a wide range of commercial investment opportunities and a detailed understanding of the Central London commercial property market.

###

Contact Information:

MERJS

Colin Becker

+44 20 7079 3976

merjs@momentumws.co.uk

http://www.merjs-agency.co.uk

In times of economic depression, the smart thing to do is to make a sure-fire investment. A sound venture that you can be fairly certain will provide you with a reasonable rate of return and a decent level of security.

Just one problem though – this is usually boring as hell.

 From Post-its to sliced bread to the nacho-sombrero, inventions and business models that sound absolutely crazy are often the ones that turn the most spectacular profit. Chances are, if you’re hard up from the credit crunch, you have neither the time nor the inclination to simply sit back and watch that measly 1.75% interest rate tick over.

What you need is an economic defibrillator for your flat-lining finances. So here are some of the coolest and most eye-catching ways to make that hard earned money work for you.

 Invest in a Major Sports Team

Which of the following statements sounds more impressive?

(1) “I just made a prudent investment in Wal-Mart; their share price has remained consistently stable despite several years of economic recession.”

(2) “Oh yeah I play the stock market – big time. Just invested in a little football team, Tampa Bay Buccaneers, maybe you’ve heard of them?”

Case closed. Nobody needs to know that your investment of 1 share accounts for about 0.00000000001% of the overall market share. It’s still a handsome addition to your portfolio.

Become a Land Owner

Ever heard of the term ‘safe as houses’? Well, the only reason that it’s not ‘safe as the land upon which houses are suitable to be built’ is because that is too much of a mouthful. If thousands of years of warfare teach us anything, it’s that land is certainly worth having, either owned or on loan. Even the cheap stuff has potential! While your modest half –acre could look like this today:

… there’s always a chance that its location is so perfect that some corporate suit is going to offer you big bucks so they can turn it into this:

Invest in a New Technology Company

Pick your favourite gadget, then pick your favourite fruity name (so to speak) and plough your money into the resulting start-up. Apple, Orange, BlackBerry, all huge money-spinners in the technology market. Whatever genius figured out that mystical combination of technology and fruit names needs to hurry up and create Banana Inc. Then you need to get in there at the ground level and invest like there’s no tomorrow.

 Purchase a Priceless Collectible

The trick to this plan is to find the collectible before it becomes priceless. Consider scouring car boot sales or eBay for that mint-condition Teenage Mutant Ninja Turtle action figure that is still in its original packaging. Alternatively, you could just buy a toy or book that is current right now and then stash it for 50 years until it becomes valuable. This is quite a commitment though. Please ensure that you have offspring or at least a younger partner so that they can cash in on your hoarding, in the event of your untimely demise.

The organisation said a balance of eight per cent of its members reported a fall in house prices rather than a rise.

In June, a majority of eight per cent had recorded an increase in property values.

Rics said the north-west and London were the only two regions of the UK to see continued price inflation during July.

Demand from new buyers weakened for the second straight month, with ten per cent of surveyors reporting a fall in enquiries during the month, up from six per cent in June.

Ongoing difficulties in securing mortgages and growing uncertainty about the outlook for the economy were the main factors behind the decline, the organisation noted.

Nevertheless, the drop in demand did little to stem the flow of properties coming on to the market, as 33 per cent of Rics members said they saw a rise in the number of homes on their books during July.

This is the highest figure recorded by the organisation since May 2007.

According to Nationwide, the average house price fell by 0.5 per cent to 169,347 in July.

Britain has long been in love with property. Whether it is that exciting step on the property ladder as a first-time buyer being handed keys to a ground-floor maisonette or the topping-out ceremony on a soaring glass and steel tower that reflects a magnate’s corporate ego, property has always been vital to the British psyche – not to mention our economy.

The figures can sound impressive over the long term. Including inflation, commercial property has grown by more than 4pc a year over the past 50 years, while residential property has gained 117pc in the past decade, even with the recent economic downturn.

But although values in both residential and commercial property have enjoyed a rebound this year from the depths of the credit-crunch-inspired recession, that recovery is starting to run out of steam. Economic growth has returned but it is proving anaemic, while banks are proving cautious. Whether you are a family looking to move to the suburbs or a developer looking to bet millions on a city-centre office block, lenders still want more money upfront and more security for their loans. Banks are under strict orders to ensure they do not fall foul of Government-inspired rules that stop their balance sheets swelling with the sort of financial tumescence that caused the recent crash in the first place.

Although we have seen plenty of property ups and downs over the past half century, this time looks different. Never before have we faced trying to rebuild our economy from the ruins of a global credit crunch that brought several of our biggest banks to their knees and prompted the Bank of England to slash interest rates to near zero and pump £200bn into the economy. As the effect of such a massive dose of emergency financial drugs begins to wear off, we face the real risk of seeing property prices start to fall back again as healthy economic recovery is proving elusive.

So the big question everyone is asking is whether recent price rises can be sustained to help us climb out of the recent slump or do we face several more years of depressed values and stagnant property markets?

For most people, it is simple bricks and mortar that matter most – the value of your home. Research by Savills, the estate agents, has forecast an inflation-adjusted rise of 40pc in house prices over the next decade. Sounds good, but that is well below the 67pc spike between 2000-2007, the 43pc rise in the 1980s and the 49pc rise in the 1970s. Another worrying trend that experts warn about is the split, which could be permanent, between those who have equity in their homes, having been on the properly ladder for years, and those who do not. Over the past 10 years the size of a deposit for a first-time buyer has risen from being roughly equivalent to 20pc of their average income in 2000, to almost 100pc today, making buying homes increasingly difficult for young people. If they cannot generate any equity then getting started, never mind trading up, is impossible.

But it is not just first-time buyers who are going to face problems in future. “We have seen plenty of cycles [over the past 50 years], there’s nothing new about that,” says Martin Ellis, head of housing economics at Halifax. “But what is new is the scale of the credit crunch, its impact and the fallout.”

The biggest change has been an end to easy credit from mortgage lenders, which was a big factor behind the most recent house-price boom. Banks are cautious about lending as they look to protect capital ratios, shore up balance sheets, maintain profits and avoid bad debts.

“There are going to be two or three tiers in the market,” says Ian Marris, a partner at Knight Frank. “The northern cities, for example, have been dependent on Government money. There’s simply not going to be the wealth to support anywhere near the sort of growth we have seen.”

Another difference this time round is an increase in flats, snapped up by buy-to-let investors before the market caved in. From 2000 to 2008, the proportion of newly-built homes that were flats rose from just over 15pc to almost 50pc. In contrast, detached housing fell from 45pc to less than 15pc. This trend increased the supply of new homes and meant that over the past 10 years, old houses grew in value more than new houses. With so many new flats on the market, prices could be depressed for some time, although that could help affordability, assuming buyers can actually get a mortgage.

One of the strange trends in recent years, however, has been the lack of pain that homeowners have suffered since the housing market peaked in the spring of 2007. Where are the repossessions, so common in previous property busts which brought misery to communities across the nation? In 1991, more than 75,000 homes were repossessed, followed by 68,000 in 1992. The highest figure in this downturn has been 46,000 in 2009.

The answer lies with the near-zero cost of money being stubbornly maintained by the Bank of England’s Monetary Policy Committee. The official Bank rate is just 0.5pc and has been since March 2009, keeping many people afloat artificially. Experts such as Ed Stansfield, chief property economist at Capital Economics, reckon this loose monetary policy is distorting the residential property market. “In previous recessions, people would have struggled to keep up with repayments. But here they are managing to keep up and one of the big drivers in the past in pushing house prices down has been distressed sales,” he said. The market, he believes, is “without equilibrium”, with prices out of kilter with the wider economic climate. They are too high, in other words, and a fall is a clear risk especially once interest rates start to rise again, as they inevitably must do.

While some residential homeowners are still sitting on huge profits accumulated over decades, the chances of having made a killing in the commercial property market have proved rather more elusive. According to IPD, the leading commercial property-price index, the real value of property has fallen by 55pc over the past half-century. Within that, industrial and retail assets have performed the best, with office blocks falling the most, even though that sector often attracts the biggest deals.

Ian Coull, chief executive of FTSE 100 industrial property group Segro, says there is a rational explanation for the trend. “Why should it do any more? We are able to match supply with demand and if there is a shortfall all we do is build more and keep pace with inflation.”

Surprisingly, property in the City of London, which along with the West End, attracts the most investment, has also underperformed. Since 1987, prime capital values in the City have slipped from £2,500 per sq ft to around £1,000, according to CB Richard Ellis. The West End has risen from £1,000 per sq ft to £2,000 per sq ft. There is another reason why residential property has performed better than commercial. According to Francis Salway, chief executive of Land Securities, the difference is in the greater difficulty developers face in building new homes than in putting up another office block. “The UK is one of the tightest places for housing,” he says. “Also, an increasing proportion of GDP has gone into salaries and therefore poured into property.”

Of course, it’s not all doom and gloom in commercial property. If you are smart, you can get rich. “Property is not a long-term hold, it is a trading asset,” says Chris Northam, of Jones Lang LaSalle. “If you get it right, you can make a fortune.”

And over the years many people have made many fortunes and, if they were smart, managed to avoid the worst falls which have happened in the 1970s, the early 1990s, and since 2007.

Patrick Vaughan and Raymond Mould, business partners who met in the 1960s, have earned a reputation as kings of calling the property cycle. With London & Stamford they are now on their third venture. They sold Arlington and retail-park developer Pillar just before previous market crashes.

The pair went into the 1970s downturn with cash, a period Vaughan describes as a “very messy market”. He adds: “A lot of money [in the property market] came from fringe banks that were allowed to crash.”

In contrast, the collapse in values in the early 1990s was linked to overdevelopment, as a string of new projects reached the market, such as Broadgate in the City of London. With this influx of new space, rental values and capital values crashed as the economy slowed down.

The fall between 2007 and 2009, which saw values drop 44pc, was a double-whammy caused by a lack of capital due to the banking crisis, and rental income falling as the recession damaged business demand for new space.

Lessons learned from the previous two falls suggest that values now face a period of stalling growth as banks look to reduce their exposure to the sector amid economy fragility and uncertain consumer spending. For those willing to play a waiting game, however, there could still be exciting opportunities.

Mike Slade made his first acquisition at Helical Bar in 1984. The property was bought from the National Bank of Kuwait after being held on its books for 10 years. “These assets don’t come out for three to four years,” Slade states. “I am quite confident moving forward, although the big problem in the next three to four years will be [the lack of] consumer spending.”

But the road ahead could be a slow one for those looking to invest, as banks are likely to take their time readjusting their balance sheets before being willing to back property schemes with loans. In the 1990s, according to figures from the Bank of England, it took from March 1991 to December 1997 for banks to reduce their exposure to property lending from its peak level to a low. This decade the corresponding peak was reached in July 2009. A return to boom times is obviously some way off.

There are some positives, though. The UK, and particularly London, has become increasingly popular with overseas investors and that extra demand is expected to support growth. In 2009, around three-quarters of deals in Central London were done by overseas investors, from Qatar, Germany and the US, compared to a third in 1994.

Although regulation and the rise of rival financial centres in the Far East threaten London’s status as a financial centre, the City’s long-lease lengths, relative transparency and international business community mean it should remain a safe haven for investors. London’s restrictive planning regime should further protect prices, according to Mr Salway. “Someone is always going to want to be in Mount Street or St James’s Street but you just can’t build there,” he explains.

Although we are in for a bumpy and unpredictable few years, positive long-term fundamentals in both residential and commercial property remain. The UK’s high population density and planning restrictions mean meeting demand with supply will always be difficult. Although economic growth is fragile at present, its return should keep demand bubbling away so that every Englishman, not to mention Scotsman, Welshman and Irishman, can still count his home as his castle.

Central London property business spun out of Liberty International, yesterday posted a pre-tax profit of £54.8m.

The increase was driven by a rise of value properties, which include Earls Court & Olympia, where Capco is planning an ambitious regeneration project, as well as Covent Garden.

The strength and potential of the UK’s capital city has been illustrated by the valuation growth and recurrent income in the group’s prime West End properties over the first half of this year.

The company owns 92 shops and 41 restaurants in Covent Garden and wants to increase the estimated rental value (ERV) of the estate over the next three years to £40m.

In the first half of 2010, the ERV rose 3.5pc to £34.4m. Mr Hawksworth has attracted Apple and Kurt Geiger to open shops on the estate and wants to bolster the quality of the retail offering further. Capco is also seeking to diversify the food and beverage range, and is planning a residential development.

London is obviously still one of the best places to make property investments in. With the downturn and economic slowdown, London still attracts the Rich from around the world who are happy to come in and spend their money.

If you make a living mainly sitting behind a PC, this could be the ideal location for you. There is a private school in Ipoh that teaches the British Syllabus and the cost is approximately £2000.00 per year for a Secondary Student.

Ipoh is an ideal place to live if you have £1000.00 per month for a family, this gives you a very comfortable upper middle class living and you get to eat out for all your meals. The Gated Properties in Malaysia offer added security and peace of mind.

Gated properties are quiet popular with the rich and upper middle class population in Malaysia as an added comfort rather than an essential requirement.

This is an ideal retirement investment as the property comes with all the creature comforts including high speed broadband.

Ipoh has everything any major city has except it lacks in the area of cultural events, theatrical shows, stage shows and live music concerts, of course all this is readily available within a 2 hour drive to Kuala Lumpur. The cost of living in Kuala Lumpur on the other hand is double and there is an enormous amount of traffic related problems.

The Malaysian goverment runs a migration programme for foreigners who have approximately £100,000.00 in their savings or an income of £20,000 per year. For full details please read

For more information on these properties in malaysia please go to www.theheaven.com.my

For more information on Ipoh please go to www.ipohecho.com.my