Austerity fears hit UK housing market

Even though the UK government has yet to clarify the vast majority of proposed cost savings from the public sector budget there is no doubt that the fear of public sector spending cuts is impacting upon the UK economy. One area which has been impacted more than most over the last few weeks is the UK housing market with buyers now retreating to the sidelines and many sellers pushing forward to take advantage of current prices.

When you consider this "panic" in the UK property market is occurring at a time when we do not know the full extent of the proposed budget cuts, or indeed how they will be introduced, we can only hope that the reality is not as bad as the speculation. If you were looking to acquire a property and all of the talk was in relation to a fall in the UK economy, would you rush to buy a house today?

The harsh reality is that in many ways we have talked ourselves into a property sector slump and the situation could become worse in the short to medium term. In what could turn out to be a self fulfilling prophecy, property prices may continue to fall as more and more buyers retreat to the sidelines and more and more sellers look to cash in their chips sooner rather than later.