Optimist v pessimist as property crunch affects all

Few can deny that property markets around the world are taking a hit right now so a major discussion point is whether to buy or wait.

The issue is of particular interest to those buy to let property investors using the forums this week. Some are worried that a lot of Polish immigrants and other East European workers are rushing back home because the credit crunch means fewer jobs and this means fewer tenants.

Several posters on the propertysecrets.net forum point out that as unemployment rises these types of transient tenants will simply move on. But others think that the rental sector will remain healthy.

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One lettings agency in Chippenham, UK, has just enjoyed letting 45 properties in September and that is the highest per month for five years.

The mood becomes pessimistic when the issue turns to when prices will bottom out. You might think three years is a bit on the down side but there are those who believe it will take a lot longer than that for the banks to start lending and the property markets to move again in an upward direction.

On a wise note one poster says there is little point in speculating under the current climate. 'One of my heros Terry Wogan said yesterday that if only the press would shut up for two weeks we would have a little more stability in the markets. Funny how a DJ seems to talk more sense that some of the experts,' declares alrichards.

In the US they are even more downbeat on the forums with one poster on the biggerpockets.com site predicting ten years of economic turmoil.  However another points out that real estate is still a good long term investment as people will always need places to live and there will always be a rental market.

But with rising unemployment will tenants have the money to pay their rent and will those with mortgages be able to keep paying their loans? The general opinion in both the US and the UK is that the number of defaulters can only go in an upward direction.

But perhaps all landlords can take heart from the following: 'I just hope the day never comes when I have to go around collecting rent in fresh vegetables or possum skins or whatever my tenants have to barter as rent.'

Some landlords on the singingpig.co.uk property forum are suggesting finding ways of reducing the cost of utility bills in properties where the tenant doesn't pay the whole bill. Changing to energy efficient light bulbs is one suggestion and putting coin slot meters on washing machines is another. How mean can you get?

But it gets even more cut-throat. Some landlords lock up the boiler after fixing certain timings so that the heating comes on and off when needed. Then there are those who would seek to regulate the use of 'power drains equipment' like game consoles, large televisions and computer equipment.

If you now need cheering up then the situation is even worse in India where the more pessimistic property investors are predicting that the once booming property market won't recover for another ten years.

The optimistic take the view that the best thing to do right now in the Indian property market is to hold onto your cash and buy when the market reaches bottom. But then you have to choose a bank that won't crash.

Here too there is concern about repossessions. The bearish forecasters predict that what is going to have an even greater impact is a downturn in the jobs market. The IT bubble in India could burst if firms downsize.

However, falling property prices are good news for young people in France, according to a post on the housepricecash.co.uk forum. Estate agents in the south, where property prices are notoriously high, are going out of business as a result of the worst property market for at least 10 years with prices falling 20%.

This means, according to Agentimmo, that young people, many of whom can't afford to buy, will be more likely to be able to and the only people left moaning will be the second home owners and speculators.