Is it time to sell real estate when all experts are saying buy?

[totallyproperty]

The beauty of the investment markets is the fact that investors and experts often have very different opinions which effectively make a market. However, when all so-called "experts" move towards a buy recommendation for real estate in any area of the world, is this perhaps the best sell signal you could get?

While this may seem bizarre, the fact is that very often those experts who have refused to recommend buying specific property, such as Dubai in years gone by as an example, are often the last to join the party as the markets keep going higher and higher. In many ways those who were perhaps a little more negative on specific markets, against the general opinion of everyone else, often get pressured into following the crowd.

Does this reflect a loss of balance, a loss of sense and in some circumstances give the impression of lemmings following each other over the edge of a cliff. Just a thought, what do you think?

 

[David119]

It is very hard to tell where we are in the market and everything, in hindsight, has 20/20 vision. I think there are enough defaults by tenants in the UK rental market to be cause for concern and it might indicate the market is about to turn. I sold a property in London (south) last year and have a property in Manchester, which for now I plan on keeping. If you are after income the margins are already very low and other financial instruments are offering better rewards without the risks of default by tenants (and quicker, more efficient disposal). I felt, in outer London at least, the price support under the asset was shaky and am focusing my attention to other areas, including other areas of property in Europe.

 

[totallyproperty]

Hi David119

I agree with many of your points and in fact you reiterate a point I was making a few days ago - the London property market should not be considered with the overall UK market. London is a market in itself, a kind of micro-market within the UK and it leads the rest of the UK property sector up and down.

The idea of selling property within London makes sense to me and the policy of retaining your Manchester property is very sensible. As London property continues to offer less value for money, investors will look further afield. I lived in Manchester for 8 years in the 1990s and know the massive development going on in the region.

Regards,


Mark