MoneyWeek has posted some pretty interesting evidence to suggest that now still might not be the right time to start buying properties again, and that house prices could fall even further in the near future, despite there being a few more positive signs in the housing market in recent weeks.
There have apparently been an increase in house viewings since the start of the year, which has got a few estate agents excited (those who haven’t yet left the industry or gone out of business).
But MoneyWeek are suggesting that the UK housing market is showing a very similar trend to the graph shown in economist Dr. Rodrigue‘s Mania and Bubbles chart, which shows the main stages in a bubble:
Compare the shape of that graph to a chart of the UK property market since 1973:
Notice the similarities? We’re probably experiencing the denial stage, with the “bull trap” just around the corner, which could well catch a few buyers out.
Of course, theory is a wonderful thing, but it does make quite a compelling case to stay out of the property market for a while to come. Or will analysing these things in such detail just perpetuate the problem?
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