Saturday, March 14, 2009

What is Lag Time?

When demand for property diminishes, the price of property will begin to fall and obviously there will be an oversupply if demand drops dramatically. The upside however as has happened in most markets will come. It is a matter of judging when the demand will begin again. The period prior to the demand increasing is known as the Lag Time . If we examine the UK market at present we know that the demand for properties has dropped dramatically over the past two years. However, an anlysis of some areas in the UK market in the past couple of weeks suggests that there is a little movement in sales. This is probably as a result of some UK banks freeing up finance to the property market. However, I believe this is a signal that we are at the crucial stage in Lag Time. Investors who are ready to pounce will probably need to do so in the next 6-9 months as this should signal the end of Lag Time. After this period, property values will begin to creep up again. In short now is the time to buy at the bottom of the market.

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