Property: What are you waiting for? Free gifts?

BUILDERS have been telling buyers for more than a year to move fast because their discounts would not last long. No one believed them, of course. Now the message has a ring of truth, as falling interest rates eat away at the stock of empty homes accumulated during the slump.

Like car salesmen, builders must shift old stock before starting on the new, which explains the continuing blizzard of discounts despite an upsurge of buyers in the past couple of weeks. But if general mortgage rates continue to fall, the estimated total of 40,000 to 80,000 empty houses could have gone by next summer.

Special offers are most generous in the South-east, where the slump hit hardest. They include price reductions as high as 30 per cent by Bell Homes, pounds 5,000 cuts by Wimpey, and up to 65 per cent off mortgage payments for one year from Rialto. Fairview is offering 25 per cent off payments for three years and, like most other builders, dangling packages which cover moving costs, legal fees and stamp duty.

Regalian has reached the stage of asking for offers on one luxury block in London, setting a 'reserve' price 20 per cent below market levels - already slashed well below the amounts paid by early buyers. And there lies the sting in the tail. It is always a gamble deciding when to jump in, as thousands have found to their cost after moving too early and seeing 'bargain' homes fall in value.

Buyers of new and second-hand homes face the additional dilemma of deciding what kind of mortgage to take. Some who rushed into fixed-rate loans at around 11 per cent when interest levels briefly soared must be kicking themselves when they see Barratt's 8.5 per cent three-year deal, or Cheltenham & Gloucester's offer of 8.25 per cent over two years. But not all.

Large numbers of C & G borrowers paying just under 14 per cent were not disillusioned by the fact that others were getting much cheaper money by the time their loans matured this year. They immediately took up new fixed-rate levels of 10.75 per cent.

About 2,000 existing borrowers grabbed the chance of switching to the Abbey National's fixed-rate offer of 10.35 per cent a couple of weeks ago, but hardly any cancelled when the tide of interest rates turned.

'Many people like the idea of knowing what they will pay every month,' said the Abbey's Paul Burgin. This is because the arrangement stretches to 1999, and few owners are certain that mortgage levels will not rise again before then.

The one certainty in all this is that the boom and slump has taught people to think first about the kind of house they want and how to pay for it, and lastly, if at all, about how much money it will make them.

BOB AND ROWENA BARLOW put themselves in bad odour with certain estate agents around Cambridge a few weeks ago by speaking out on this page against the sloppy and impersonal service they had received. At least one failed to get the message, however.

Shortly afterwards, a representative of a large local chain, attracted by a rival's 'For Sale' notice in the garden, stuffed a scrap of paper through their letterbox with the scrawled message: 'Please contact myself at your earlist (sic) convience (sic).' No knock on the door - 'although we were in the house at the time', said Mr Barlow. No smooth attempt to get them to switch agents - but that is against the profession's code of conduct. Then again, perhaps the chap who wrote it was late for his spelling class. Needless to say, the Barlows will not be making use of that particular company.

SHOCK WAVES ran through Derby with the news that the Prison Service would not be moving there from London as planned. Builders have geared up to the prospect of 2,000 new buyers, so the city will continue to suffer from a homes surplus which has depressed prices. 'We rode slumps pretty well in the past and will survive the latest blow, but the cancelled relocation is a shame as it would have cleared the backlog and given us a mini-boom,' says Howard Bannister of Halifax Property Services.

The new Toyota plant has been a shield to other blows, such as redundancies at major employer Rolls-Royce; but the general recession has still bitten deeply. The average terrace house, which doubled in value to pounds 30,000 in 1988, is now down to pounds 20,000.

A three-bedroom detached home in Etwall, a village near the Toyota plant west of Derby, fell more than pounds 8,000 over six months to sell at pounds 82,750. A house in Stenson Fields, near the Rolls-Royce factory, bought for pounds 55,000 in 1991, was put on the market for pounds 45,000 this year and fell another pounds 2,000 to sell in three months.

A semi in the popular Allestree suburb, worth pounds 60,000 in the boom, took four months to sell for pounds 53,000. 'A lot of people are in this situation and unable to move because their homes are worth between pounds 3,000 and pounds 10,000 less than they paid,' says Mr Bannister.