Is the UK property market on the verge of collapse?

Today's revelation that the average property price in the UK fell by £6000 in September, compared to August, was a bitter blow for those hoping that the UK market would remain strong in the short to medium term. If we are seeing significant falls in the cost of property in the UK even before the vast majority of government austerity measures have kicked in, the situation in the short term does not look good. So is the UK property market on the verge of collapse?

While there is no doubt that the reduction in September was unexpected and much larger even the most sceptic of economists had feared, we need to take the longer term picture into consideration. Taking one month's figures in isolation is very dangerous in any economic environment but in the current environment it could turn out to be catastrophic. We need to let the trend settle down and see the direction of the UK property market in the short, medium and longer term and indeed try to inject some confidence back into the marketplace.

This will not be easy but we depend upon the UK government and the UK authorities to remain calm in troubled times and take the right action.