There have been a couple of interesting ‘try ons’ by flat owners, trying to avoid having to pay service charge. You know there is a rule that a landlord can’t recover service charge for expenditure incurred more than 18 months before the service charge demand. But nearly every service charge arrangement works on the basis that the landlord will charge something on account, and then have a balancing charge at the end of the year when the accountants have checked all the figures. So, in this particular case, the landlord charged ‘on account’ of the expenditure well within the 18 month period, but the final balancing account didn’t come through until more than 18 months after the actual expenditure. The tenants tried to argue that none of the service charge could be levied, and what’s more they should have their advance payment back. Their argument was that service charge was only what you paid when it was finally calculated, and that advance payment wasn’t actual service charge, just a kind of loan. The court disagreed. The flat owners’ case probably wasn’t helped by the fact that the service charge was actually in credit, so that there was a small balance due back to the tenants at the end of the year, rather than payment required from them. But I admire their cheek in coming up with an ingenious way to try to avoid paying service charge.

In another case, which doesn’t seem quite so fair, the tenants objected to having to pay a big service charge for some repairs which only cost so much because the landlord had neglected to do the repairs for several years. The law says a landlord can only recover a service charge amount which is “reasonable”. The flat owners’ argument was that it was unreasonable to let the damage mount up. Unfortunately, the court took the view that the only thing which had to be reasonable was whether the cost at the time was correct for the work needed, not whether the landlord was reasonable in not doing the work earlier.

Apparently one large law firm has told its conveyancing solicitors that they will be made redundant - unless they want to take a post in Eastern Europe. I suppose it’s better than most property lawyers are getting. Some of the largest firms in the country are is simply laying people off with no more than statutory minimum redundancy pay.

One sure sign that the property market is not just going through a short term blip is that even the Land Registry is having to lay off staff. . This is because the number of properties changing hands has fallen so markedly. Apparently about 1,250 staff in the various Land Registry offices around the country are being offered redundancy terms. The Land Registry employs 8,300 people, so it’s laying off a sixth of its workforce. The Land Registry have the best data possible on what is happening in the property market – prices and deals. So if they are judging that there will be no quick return to a vibrant market any time soon, that is depressing news.

I have been reading about the mortgage frauds on a very large-scale which are being uncovered in flat developments in Thamesmead. No one notices mortgage frauds when the market is going up, only when it crashes and the lenders don’t get paid.

Financially savvy criminals agree to buy a load of new flats from a developer off-plan at a very steep discount to the published price - perhaps even 30% lower than the developers are advertising the flats to the public. The crooks then sell them on at the published price. Nothing wrong so far. They are perfectly entitled to take the gamble of signing up at a discount and they do pay their 10% deposit to the developers. But they don’t rely on finding real buyers, although they may find a few. What they do is come up with a load of phoney buyers who take out self-certifying mortgages – “lie-to-bet” mortgages as they are now amusingly called. The crooks don’t even need bent surveyors for this. The surveyors can see what price the developers are offering the flats at, so they can certify that figure as the appropriate value to the lenders.

Then at completion the ultimate buyers use the mortgage money to buy the flats off the crooks, who simultaneously buy them off the developers as the agreed discount. When the buyers are phoney they never pay the mortgage, the crooks merely let the flat and pocket the rent till the lenders repossess, up to a year later.

The fraud was essentially in not taking the risk of buying off plan and then having to find real buyers, but setting it up so that the mortgage companies would be financing the whole thing anyway with they realised it or not.

Developers helped this process along, because they refused to reveal to banks what discounts they had offered to other buyers. So lenders were always assuming unrealistically high values for the flats, because they were going by published intended values, not real deal prices. When the potential for fraud was revealed, the banks threatened to stop lending on new blocks of flats altogether. The deal they have now done with developers is that the lenders must be told the amount of any discounts.

Probably no one will ever get prosecuted.

I keep reading the newspapers hoping for some good news about the property market and they keep giving me bad news. The bad news is that property values have only fallen an average of 2.2% this year compared with last year, according to the Financial Times. I was hoping for something more like 10% to 15%. The sooner sellers forget what someone told them their property was worth over dinner in February 2007 and start putting their properties on the market at attractive prices, the sooner buyers will start sensing bargains and come back into the market, and we will all be trading again.

But these figures from the Financial Times just don’t make sense to me even though they say the Land Registry has come to roughly the same conclusions. According to the two of them, prices have just fallen back to where they were in May 2007. That’s certainly not my experience in central London. Even when prices are agreed at a discount to the asking price, the price is still inevitably going to be slashed again just before change contracts, and I haven’t yet come across a seller refusing to agree a further reduction. My experience is that such reductions from the original asking prices are a lot more than 2.2%, and I’m not talking about asking prices set at the top of the market last year, but prices at which properties were being put on the market in the summer this year.

I think the problem with trying to compare prices from one year to the next is that there is no single commodity like there is in the financial markets which you can compare from year to year. You can compare prices for an ounce of gold or a bushel of wheat from one year to the next, but you can’t very well have a market in three-bedroom houses you can measure accurately. If you had to value wheat according to whereabouts the field is, and what sort of bag it’s in, you couldn’t couldn’t come up with a standard value for wheat which you could compare from one year to the next either.

So I am forgetting about indexes. I think what really matters is the experience of estate agents in particular areas. I think if you tried to tell estate agents in South Kensington that prices have only dropped 2.2% since February 2007 … well at least it  would give them something to laugh about.

I’m hoping my gut feeling, based on deals we’ve been involved in this year, is right, and asking prices have dropped – and are still dropping — sharply. If you follow the stock market, you will know you can have strongly trending markets, going up or down, or you can have markets which just trend “sideways” - in other words they do nothing and the stockbrokers starve, or at least book cheaper holidays.

The good thing about a strong move downwards is that there is every chance it will quickly hit the bottom and start back up. There are definitely buyers out there looking for a bargain. Properties for refurbishment are being snapped up at auctions by buyers with cash.