LONDON CALLING:In the same week that the Bank of England gave £50bn to lenders, some big names pulled mortgaes from buy-to-let borrowers, writes Angela Pertusini.
Here you go: I'm not quite sure how the figure of £50 billion was reached but it's a tidy sum - more than even Philip Green or Bernie Ecclestone would lavish on a loved one's birthday party. But not enough, it turns out, to ease the squeeze in our mortgage market.
In the same week that our chancellor, the hapless Alistair Darling, promised this staggering amount to underwrite British mortgage lending, the lenders themselves let it be known, rather gleefully, that this would only stabilise current loans and would not, as the government hoped, push costs down on future ones despite the Bank of England's heroic efforts to lower the base rate.
Ignoring for several minutes whether UK taxpayers should be responsible for propping up a housing market that many regard as (a) divisive and (b) inherently unstable anyway, it must have been a bit of a slap in the face for the unfortunate chancellor to have such big names as the Abbey pull some mortgages within hours of his gallant offer.
And which mortgages did the Abbey single out for particular punishment? Only buy-to-let. Now, England has long had a notorious north/south divide and this has only deepened the chasm. Because, while we were encouraged initially to focus our bile on feckless American sub-primers, closer to home it is the army of wannabe landlords who piled onto the buy-to-let wagon and bought up thousands of "luxury apartments" in city centres such as Leeds, Manchester and Liverpool who are to blame for this prolonged wobble.
It turns out that, as with many gold rushes, it has been the people selling shovels rather than the prospectors that have grown rich. In the case of all those out-of-town investors, only the "property clubs" to which they paid enormous fees in order to buy their flats at a "discount" (although there is serious doubt whether some of these initial valuations were in any way accurate or the rents quoted at all realistic), seem to have made any money.
The knock-on effect is that, while buy-to-let has traditionally been an incredibly safe market for lenders, the tales of woe floating down to the Square Mile from north of the M6 have made the whole amateur landlord package seem fragile.
It seems slightly unfair on wiser investors who did their research more thoroughly and have more stable portfolios but buy-to-letters are going to be this slump's whipping boys and the banks will love every fee-squeezing, rate-hiking minute of it.
• SHOULD ANY of you wish to buy in these uncertain times, my tip would be: forget house size and concentrate on the garden. British newspapers have become almost hysterical in their championing of vegetable patches and regularly feature sweet souls who believe growing their own potatoes will protect them from the worst excesses of the credit crunch.
Outside space has morphed from being somewhere that buyers can imagine relaxing at the end of the day with a glass of wine, possibly inviting a few friends to for a barbecue, into a potential smallholding with neat rows of health-giving/inflation-busting cabbages and carrots.
For those with an eye on the apartment market, fear not: we are regularly exhorted to use balconies, flat roofs and even window boxes in our bid for self-sufficiency.
• OF COURSE, the more practical idea might be to sub-let all those empty office blocks to those on the waiting list for allotments. So often made of glass, they could be used as gigantic greenhouses and the rents these born-again crofters paid would be better than the zero income as much as seven million sq ft of office space will generate over the next couple of years across the City and Docklands.
Moody, the credit agency responsible for this miserable statistic, predicts that London's office market is deteriorating faster than any other European centre.
EVERY LITTLE HELPS TESCO EXPAND BUT PROPERTY FORAY IS CURTAILED
TESCO HAS abandoned its plans to create an online property store and caved in to estate agents' demands not to undercut them.
Today Spicerhaart, which owns the Haart, Felicity J Lord, Spicer McColl, Darlows and Baileys chains, and Tesco, confirmed that final negotiations are taking place for the purchase of Tesco Property Market, the store's online portal which had been offering clients the chance to market their homes for £199 online.
When Tesco launched the site last year, estate agents stopped advertising on it in droves after they discovered that Tesco was offering the new service.
At the time Spicerhaart, which was one of the store's major agent advertisers, was the first agent to instruct Tesco to remove its details from the site.
Your Move quickly followed suit refusing to allow its listings onto www.tescopropertymarket.com. The move forced Tesco to rethink its property portal.
Paul Smith, chief executive of Spicerhaart, said: "Final negotiations are taking place with Tesco to buy their estate agency business.
"Spicerhaart is developing a new innovative virtual estate agency business in partnership with Tesco, who will be the main distribution partner. This business, which will benefit from our well established property expertise, will offer a high quality estate agency service."
A Tesco spokesperson said: "We have been reviewing our internet estate agency for some time and been exploring ways in which we might be able to bring more value and choice to home movers. This has involved us talking to others in the industry and we are now in the final stages of negotiations for a deal to sell TPM to Spicerhaart. TPM and Spicerhaart will develop a new and comprehensive online estate agency service and this will be available to our customers at Tesco.com."
