As Dusty Springfield famously sang, “the world goes round without even a sound, and it looks like summer is over”.
Dusty was spot on regarding the second part of that lyric but the property and financial worlds were making plenty of noise over the past few months.
Growing confidence in the markets
Stockmarkets have rebounded, as have equities and commodities. Investors have regained their appetites for debt and the interest rates at which banks lend to each other has fallen back to near pre-crisis levels. Ben Bernanke, the Fed Reserve chief, has announced that the worst recession since 1929 was “very likely over at this point“. The Sage of Omaha himself (aka Warren Buffett), told CNBC yesterday that “the US housing crisis was over“.
Confidence is also growing rapidly amongst large investors. I’m not just talking about hedge funds starting to actually buy shares again rather than short them, but also about pension funds and private equity groups buying huge amounts of distressed property in places like Florida.
Twice in the last 4 weeks I’ve seen developments with 100-300 units for sale taken off the market because single groups have purchased them outright, swiping the rug out from under the feet of those who were considering purchasing one or two units.
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