UK BANKS TRIGGER PRICE FALLS

The first half of 2008 was a difficult time for the London residential property market. The banking liquidity crisis led to the loss of 60% of new enquiries in the sales market, compared with the first half of 2007, and resulted in a downturn in transactions that was exacerbated by reports of consumer confidence hitting the lowestpoint since 1990.

With fewer enquiries vendors, including some developers, increasingly looked to the rental sector as part of a longer term strategy, rather than sell in a buyers’ market. The private rental sector has provided a lifeline, unlike the last two major property corrections in the early 1970s and 1990s, when the rental market was not established as a viable alternative.