Is Sarah Beeny Responsible for the Global Recession?

I hope readers even my American friends understand a type of humour called sarcasm, if not I will explain it to you later! While I too have watched Sarah Beeny and the plethora of other home renovation programmes that grace our TV ever curious to see if a once flock wallpapered house can be transformed into a modern palace. I propose the Sarah Beeny effect! During the early years people could seem to do no wrong and costly mistakes and weird choices still resulted in the featured homes selling for healthy profits and a smiley presenter such as the lovely Sarah Beeny declaring the renovation a success! The programmes would generally then come to an end with the fledgling property developers buoyed by their renovation success announcing that they had already bought another property to develop in their unique style.

Nothing wrong with this that I hear you say, and in truth this could be seen as entrepreneurial people attempting to either branch out and start a new career or simple increase their income. Now while I use dear Sarah as a figurehead I do so in jest and know that she should not be entirely held responsible, well if only a little bit because there are so many other factors to consider.

The factors as I see them are:

1, The Sarah Beeny effect

Everybody believes they can renovate houses and so therefore move with more frequency as they knock down and paint their way to a profit or loss. Mass property ownership was something of a rarity a merely 20 years ago, kept for the rich and those with titles. Now it is quite commonplace for Bob from the office to have a property portfolio! This has meant with the growth of the population housing demand continues to increase. Gone are the days of finding a true gem and doing up the house as you would like it, chances are it has already been done!

2, Banks and mortgages

Yes i too will take the opportunity to run up behind a banker and put my boot in. Unregulated banking saw the creation of so many mortgage products that would allow the average joe to move up in the world from a house to a palace. 100% mortgages, interest only mortgages, 6 and 7 times your annual wage mortgages were deemed acceptable and obviously the banks and their elite employees raked in the profits as a result. Suddenly you could place your house on the market and expect a bidding war as property was limited and in great demand. People saw prices rocket but were still prepared to pay the money, with interest rates low and the economy in great shaped what could go wrong?

In truth there are many more factors that could be covered and this blog could become a book, or people would just fail to complete reading it because they had to go to work and pay off their credit cards with excessive limits. Sorry bankers, that was two kicks!

So what is my conclusion? Well as the recession bites and holds on to your leg like a rottweiler hungry for flesh house prices have slowed but in many cases still continue to gently climb. So we find ourselves with jumping inflation, shrinking wages and the specter of eventual significant interest rate increases. Sorry not a happy statement but argue with me if you feel I am wrong! So people have less money and are struggling to get by while trying not to think about the eventual increases in their mortgage repayments as interest rates go up. So people sit in their Sarah Beeny renovated houses unsure what to do stagnating one of the cornerstones of the economy, the housing market.

I leave you with the thought that, will we enter what is known as the double dip recession, or have we ever left the first dip in any case? First time buyers can not afford the inflated prices of the Sarah Beeny effect as banks no longer lend with unregulated gluttony. So how will we ever get ourselves out of this mess without house prices coming down, another word for it is crashing. As interest rates rise as they inevitably must how many people can afford the increases in mortgage repayments? Perhaps then prices may begin to reflect the true value of a house as people have to sell or homes are repossessed!

A final sub note to Sarah Beeny and all readers, I did enjoy your programme and hope that you can smile at this blog like you did at some of the horrendous choices made while renovating on your show. Honestly pink walls no, no, no!