We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
Debate House Prices
In order to help keep the Forum a useful, safe and friendly place for our users, discussions around non MoneySaving matters are no longer permitted. This includes wider debates about general house prices, the economy and politics. As a result, we have taken the decision to keep this board permanently closed, but it remains viewable for users who may find some useful information in it. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
How much reduction would tempt you to buy now?
Comments
-
Agreed. The rents are already taking a big dump in my area (Leeds) if you look at rightmove and they're continuing to drop on a weekly basis. There are still way too many dreamers expecting £550 per month for 250sqft of space in city centre "crash pads" :rolleyes: where your kitchen, lounge and bedroom is the same room and about the size of the bathroom in yer average 3-bed semi. :rolleyes: They're now pricing them slightly more realistically at £350-375 per month but they're still not getting folks in.
Pretty much the same applies in other parts of Leeds too. Dreamers wanting £450 per month for a [strike]bedsit[/strike] "studio apartment" :rolleyes: where the decor hasn't seen a brush since the house was built and kitchen units out of 1950s council houses.
Just who are they trying to kid? :rolleyes:
Rob
I wont try to argue that different areas are affected differently.
I've been saying this for a long time.
In the area I have properties I have increased the rent since Jan last year.
Horses for courses.
Do the market research, if the rental market is strong (as it still is in a lot of areas (there are always exceptions)) then I do not see how prices would drop.
Naturally, if the rental market is weak, then rent prices could drop.
With so many people selling to rent, FTBers trying to get their first property, more and more students going to University. I would guess (I d o not have any facts to back it up) that the rental market is probably the strongest it has been for a long time.:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
IveSeenTheLight wrote: »I'm thinking you are extremely lucky for the credit crunch to happen resulting in the old lending criteria being restored and to have a substantial deposit meaning mortgages will still be available to you
Just dont think prices will drop 70 or 75%
Credit crunches are not a new phenomenon, so I don't count myself "lucky".
There has been a rhythm of boom and bust in which depressions have recurred every fifty to sixty years since records have been kept. The depression of the 1930s is the sixth major credit cycle to end since the beginning of the eighteenth century. The one I think we are heading in to has been delayed by Governments thinking it's a policy success to maintain living standards by running every greater amounts of debt.
Something has to give once the mania of lending every greater amounts of money, resulting in ever higher house prices, continues for years to ridiculous heights... when it reaches the stage when there's not enough money to lend to continue supporting the buying of ever more expensive properties.0 -
Just to back this up, I've used the HPC image but you can also see on Nationwide's latest release http://www.nationwide.co.uk/hpi/historical/apr_2008.pdf to show the current average price and the real House price averageIveSeenTheLight wrote: »Taking the UK average, you want the uK average of circa 178,000 to be 45,000.
The "Real House Price Trend" is somewhere around 145,000.
Now these graphs do show a significant drop below the Real House Price average, but project your 75% drop and you will see that the prices would go back to pre 1970.
Do you really think this will happen?
If you look at http://www.hbosplc.com/economy/inclu...TownsData3.xls you will see the reginal affect on house prices during the last 20 years.
I carried out a very random check and found that most areas only saw very small nominal drops the last "crash" and mostly Lopndon prices dropped the most.
I believe a similar thing could happen here with London price drops affecting the UK average more and the rest having smaller nominal drops.
Add into effect inflation and the 22% I original mentioned required to be reduced on average to meet todays Real House Price average then the percentage becomes less
75% :rotfl: :rotfl: :rotfl::wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
There are plenty of people around with liquid assets ready to jump on good deals in the market. I think many under-estimate the number of people who have made proper money (i.e. cash) during the recent housing boom. The right deals (on solid family properties in decent areas) are still getting good interest (deals at over 95% of market value, I know I've tried going in at 90%!). But city centre BTL new-build 'developer discount' stuff is going to take a hammering, I agree and could be a really good source of very affordable first-time buyer stuff.18 May 2007 (start of Mortgage):
Coventry Offset Mortgage £220800
Offset Savings: £0
Mortgage Balance: £220,800
14 Jan 08
Coventry Offest Mortgage: 219002
Offset Savings: 28200
Mortage Balance: £190802
And still chucking every spare penny into it!0 -
IveSeenTheLight wrote: »If you look at http://www.hbosplc.com/economy/inclu...TownsData3.xls you will see the reginal affect on house prices during the last 20 years.
I carried out a very random check and found that most areas only saw very small nominal drops the last "crash" and mostly Lopndon prices dropped the most.
I believe a similar thing could happen here with London price drops affecting the UK average more and the rest having smaller nominal drops.
The thing that you don't factor in is that the world's economy is starting to look like there could be serious problems ahead. Oil prices are climbing and Goldmans (who predicted $100/barrel oil) are now predicting prices of $200/barrel. Check the impact on the world economy in 1974 and 1980 when oil prices shot up.
Now look at the economy of the UK. In the North East, 70% of GDP comes from Government spending. The Government is spending everything it can right now - it's very hard to see how spending can be pushed up if tax receipts start to fall as a result of economic problems and mutlinational companies abandoning the UK for more tax-friendly bases. If the Government has to cut spending, NE England is going to be very hard hit.
Now look at politics. The Tories are massively ahead of Labour in the polls. If they win do you imagine they'll keep shovelling the pork to Labour areas or do you imagine they'll dish out the pork to their own supporters? Another reason for Govt spending to fall in the NE.0 -
The thing that you don't factor in is that the world's economy is starting to look like there could be serious problems ahead. Oil prices are climbing and Goldmans (who predicted $100/barrel oil) are now predicting prices of $200/barrel. Check the impact on the world economy in 1974 and 1980 when oil prices shot up.
Now look at the economy of the UK. In the North East, 70% of GDP comes from Government spending. The Government is spending everything it can right now - it's very hard to see how spending can be pushed up if tax receipts start to fall as a result of economic problems and mutlinational companies abandoning the UK for more tax-friendly bases. If the Government has to cut spending, NE England is going to be very hard hit.
Now look at politics. The Tories are massively ahead of Labour in the polls. If they win do you imagine they'll keep shovelling the pork to Labour areas or do you imagine they'll dish out the pork to their own supporters? Another reason for Govt spending to fall in the NE.
Being a geordie lad, I have to agree.
The NE has NOTHING to offer becasue we are a bunch of chavs taking handouts. Isnt it about time we stood on out own two feet? Invested in ourselves instead of buying bling and propping up old unprofitable business?
Sadly, it'll never happen, we'll just insert another coin into the fruity and hope for a big win. Take the Northern Rock, it's 'our bank' sentement. What a load if crap, it's 'our failed back, please give us another handout'.
Shame on you geordies.0 -
>Check the impact on the world economy in 1974 and 1980 when oil prices shot up<
The twist is that if inflation does return to 10%+, then having leveraged debt on tangible assets isn't a bad proposition since the 'real' debt is eroded away (obviously so long as your income rises with inflation, being in a public sector job wasn't at all clever in 1976-1983!)
A return to 2005 prices (i.e. 20%-25% fall) over the next 18 months would seem to be a sensible supposition; obviously with regional variations that favour the SW to NE.0 -
The thing that you don't factor in is that the world's economy is starting to look like there could be serious problems ahead. Oil prices are climbing and Goldmans (who predicted $100/barrel oil) are now predicting prices of $200/barrel. Check the impact on the world economy in 1974 and 1980 when oil prices shot up.
I understand your thought process and I don't discount the effect on oil price.
See http://forums.moneysavingexpert.com/showpost.html?p=10632663&postcount=6 where I previously discussed oil prices including this graph going back to 1970 regarding the oil price
It does not diminish what I said, regarding regional affect and how London prices vastly affect the UK average and they may see more dopr than the rest of the UK, affecting the UK average by a higher amount than what is seen across the rest of the uk.
If you believe that the global economy will be affected more this time than last, thats fine, but proportionally, I believe it will still be the same:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
I wish I had the georgdie mentality, spending every waking hour down the 'Pig Market' or at the indoor funfair.Being a geordie lad, I have to agree.
The NE has NOTHING to offer becasue we are a bunch of chavs taking handouts. Isnt it about time we stood on out own two feet? Invested in ourselves instead of buying bling and propping up old unprofitable business?
Sadly, it'll never happen, we'll just insert another coin into the fruity and hope for a big win. Take the Northern Rock, it's 'our bank' sentement. What a load if crap, it's 'our failed back, please give us another handout'.
Shame on you geordies.0 -
Hmm. I certainly will want at least 25%, but I think if prices fell 25% I'd be looking for 40%.
I wouldn't want anything smaller than this:
http://www.rightmove.co.uk/viewdetails-20551547.rsp?pa_n=1&tr_t=buy
at £1m
and frankly I don't see that £600k is exactly cheap.
Just to add, I'm living in a house now thats £1500/month. The house next door I viewed, and it needed some improvement, sold for £525k. So I am saving
£1000
EVERY MONTH on the interest alone
and then the house had a new kitchen fitted when we moved in, new appliances. The freezer just broke down and it is being replaced. Add in the maintenace saving, you can add £200 a month to the cost.
So any house price falls are frankly icing on the cake.
If we stay for two years, we've probably around £30,000 just on interest and maintenance, and at £525k, a good £75k off seems extremely realistic.
So that means I will £50k/year just from renting. It reminds me of all those Daily Mail articles: 'homeowners making £30 a day from doing nothing'.
Thanks guys!0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 352K Banking & Borrowing
- 253.5K Reduce Debt & Boost Income
- 454.2K Spending & Discounts
- 245.1K Work, Benefits & Business
- 600.6K Mortgages, Homes & Bills
- 177.4K Life & Family
- 258.8K Travel & Transport
- 1.5M Hobbies & Leisure
- 16.2K Discuss & Feedback
- 37.6K Read-Only Boards