Everyone agrees all is well. It isn't

Today, many investors are finding that, far from making them rich, their buy-to-lets are costing them dear in cash terms.

Mortgage costs are rising, sales volumes have collapsed, and house prices are on the way down. Yet even in the face of these steadily deteriorating fundamentals, estate agents, mortgage lenders, industry insiders and much of the press continue to claim that all is well in the property market. For estate agents in particular, all news is good news as far their predictions about the market are concerned. Rarely do you get to hear that any segment of the housing market is weak, at least not until after the event, when they're often happy to report that the market is now better than before.

These upwards-only commentators famously led us into the 1990-1994 housing crash by telling us not to worry, all was well. And today, most agents and agency bodies are forecasting solid house-price growth forever. My bet? They'll continue to do so until well into the downturn.

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James Ferguson qualified with an MA (Hons) in economics from Edinburgh University in 1985. For the last 21 years he has had a high-powered career in institutional stock broking, specialising in equities, working for Nomura, Robert Fleming, SBC Warburg, Dresdner Kleinwort Wasserstein and Mitsubishi Securities.