Staying off topic for a minute...
A property investor who bought a flat for £175,000 at the height of the housing boom has ended up in a negative equity nightmare after its value nosedived by almost 50 per cent.
What the investor didn't mention was that he bought off plan based on a valuation of £175k which was very probably inflated to ensure that he had 30% equity at day one. The property possibly never actually had a true value of £175k. (true LTV may have been as much as 100%) Valuers get caught up in a game of ever rising value where the sales at inflated asking prices are recored in the land registry. This provides 'evidence' that there are buyers willing to buy at that price. The Buy to let investors that were buying into immediate equity deals were taking a punt on the market rising further so that their notional equit became real equity. When the market bombed their equity evaporated.
Yes, the market has been re based and it is now probably a good time to buy cheap interest rates, cheap property and wide choice. Buy for need not for greed. We are unlikely to see a rapidly escalating housing market for some years to come - until the banks come up with a new wheeze to make easy money!
How does this affect aviation - leisure travel is discretionary expenditure. People tend to judge wealth on their paper worth - even when their cash position is quite weak. If their houses are rising in value they will spend that 'unearned' income. Business travel is seem as extravagant and when jobs need to be culled and businesses are going to the wall it is the frugal managers that thrive.
We are seeing some improved financial news. This could be a dead cat bounce - in which case we are all doomed - or evidence that market confidence is returning. Only hindsight will tell. However, sooner of later we will have stability again and gradually pax will return. Unfortunatley, I think there may be a few casualties before that happens.