Property: Dear Dr Freud: re housing complex

Dear Dr Freud,

AM I mad? I keep hearing these voices. I would not mind if they said the same thing but they keep changing. This week the Halifax reported its second successive monthly rise in home prices (1.6 per cent for April). Another had told me prices would fall this year, but now says they will stay the same. Yet another nags away that they will rise. And all predict that prices will rise next year, but no two agree on how much. What should I do?

Sincerely,

A. Homebuyer.

Dear Mr Homebuyer,

No, you are not mad. Monthly figures have been known to go up and down like proverbial yo-yos but with two rises in a row the Halifax is being bullish: with the usual provisos, it says prices will rise this year, perhaps even more rapidly than previously thought. When another voice you identify as the City analyst John Wriglesworth says prices will stabilise this year and rise 7 per cent in 1994, this is entirely consistent with his message a few months ago that they would fall by 5 per cent this year and rise 5 per cent in 1994.

Things do change. Interest rates have slumped and more than 100,000 homes will be snapped up by Christmas. In the South-east, more than 1.5 million owners cannot move because their homes are worth less than they cost, so buyers have less choice. Thus prices could rise 10 per cent next year.

The fact that a Patrick Moon from Lloyds Bank says prices will rise 3 per cent this year is also logical. These voices emanate from a source called 'economists', who spend thousands on computers to analyse statistics and then take what is known in the trade as 'a good guess'. A few per cent either way is seen as accurate.

Now let us look at something that backs up their new-found optimism. House purchases soared in March, says the voice of the Adams Residential Property Index: the first rise in a couple of years if you ignore 'blips' after activity by two of my other patients, President Saddam Hussein (after the Gulf war) and Mr Norman Lamont (who declared a stamp duty holiday). This is a real green shoot.

So is the fact that 250 homes were sold in London's Docklands, that pit of the property recession, in the first months of this year. That is more than the whole of 1992, according to Martin Ebbs of the research group Ancer. David Goldin of Fox & Sons reports sales up 16 per cent on the same period last year in offices across the South, while a chorus drawn from an even wider area by the Incorporated Society of Valuers and Auctioneers says that inquiries from potential buyers almost doubled between January and March.

So: predictions are becoming rosier as things improve. Some green shoots are poking through; next year should produce a veritable jungle.

Yours,

S. Freud (Dr)

PS: On second thoughts you must be mad. Who but a madman would write to a dead person for advice on housing?

THERE ARE times when those of us who live in the Smoke would just like to up sticks and leave - preferably to a rural haven of peace, clean air and solitude. The big problem is tracking down the right place, as Brian Higgs discovered five years ago. 'I was already fairly remote in North Yorkshire and wanted to get back to Scotland, where I grew up,' he says. Mr Higgs drove several thousand miles to find a compromise in the delightfully named Slaggyford, near Carlisle. 'You could register with 10,000 agents and still not find the property you like,' adds Trevor Kent of the National Association of Estate Agents.

Mr Higgs's experiences sparked the idea for In The Sticks, a newspaper packed with barns, thatched cottages, crumbling mansions and old churches which has become the bible for wilderness fanciers. Many only found this source of information halfway through exhausting cross-country hunts, spotting a copy at some country agency.

Then Monarch Distributors realised that if subscriptions could reach 6,000 merely by word of mouth, there must be a lot more potential. So Mr Higgs is producing 15,000 copies for newsagents this month. It is worth a look if only to compare the prices of derelict barns with those already converted, and also to keep an eye out for that dream of a ruined farmhouse for less than pounds 30,000.

In the Sticks: 0434 381404.