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There will not be a crash
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TBeckett100
Posts: 4,732 Forumite
I am getting a little fed up with HPC threads and doom and gloom.
I agree we are ending a bull run but I suspect that the fears are eScalated by the fast access to news online and forums which sends people into a blind panic and sets their expectations low. These forums now encourage people to make heavil reduced offers and sellers who are anxious and believe in a HPC are selling low, compounding the problem. The HPC were are seeing (in reduced terms) in my opionion is being generated by news and consensus.
If we look at our landscape, we are an island. It isnt going to get bigger and we have a shortage. Since we cant access more land, keep tight control on greenfield sites and have a need for housing, demand still outstrips supply.
Looking on rightmove in my search, all I can see are the same old houses for sale, overpriced or poor locations. The market isnt teaming with gorgeous properties and certainly in my search, I discounted 20 properties per 1 offered.
In addition, I dont realistically think mortgage lenders will be lending 80+ if they see a 40-50% crash. The risk is too huge.
Therefore my opinion is that if your on the ladder keep moving, if you are a first time buyer,prepare to stay in that first home for 5 or so years.
I agree we are ending a bull run but I suspect that the fears are eScalated by the fast access to news online and forums which sends people into a blind panic and sets their expectations low. These forums now encourage people to make heavil reduced offers and sellers who are anxious and believe in a HPC are selling low, compounding the problem. The HPC were are seeing (in reduced terms) in my opionion is being generated by news and consensus.
If we look at our landscape, we are an island. It isnt going to get bigger and we have a shortage. Since we cant access more land, keep tight control on greenfield sites and have a need for housing, demand still outstrips supply.
Looking on rightmove in my search, all I can see are the same old houses for sale, overpriced or poor locations. The market isnt teaming with gorgeous properties and certainly in my search, I discounted 20 properties per 1 offered.
In addition, I dont realistically think mortgage lenders will be lending 80+ if they see a 40-50% crash. The risk is too huge.
Therefore my opinion is that if your on the ladder keep moving, if you are a first time buyer,prepare to stay in that first home for 5 or so years.
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Comments
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There is no ladder its an utter falacy invented by someone who can convince a morons0
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i think going from a 1 bed flat to 5 bed detached is ladderish? hadly a slide0
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I'm not convinced that detached ladders are a very good idea. If ladders have nothing to lean on it's all going to end in tears.0
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The problem with ladders is they are often wobbly and very prone to toppling over unless you have someone extremely reliable holding on tight at the bottom!
I can just see the latest episode of Mr Bean... Rowan Atkinson up a ladder extremely nervous as he looks down and realises he has a long way to fall... Brown and Darling desperately trying to convince him they have everything under control at the bottom! I can hear the 'c' word happening any minute now!!!! :eek::eek::eek:“A journey is best measured in friends, not in miles.”
(Tim Cahill)0 -
TBeckett100 wrote: »Therefore my opinion is that if your on the ladder keep moving, if you are a first time buyer,prepare to stay in that first home for 5 or so years.
Why should they prepare to stay in that property for FIVE years?
I get you. Negative equity.
Yes, nice tip.
Thanks.
And, poor you, getting fed up with house crash threads (while starting yet another). How about you put up with 10 years of irresponsible price rises.
See how you like them bananas.
Flaming whingers...0 -
Mummy bear says easy credit is good!
Daddy bear says easy credit is good!
Baby Bear Stearns isnt so sure!
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Only smarties have the answer!!
I'll tell you if it is a crash in a couple of yearsLets get this straight. Say my house is worth £100K, it drops £20K and I complain but I should not complain when I actually pay £200K via a mortgage:rolleyes:0 -
meanmachine wrote: »Why should they prepare to stay in that property for FIVE years?
I get you. Negative equity.
Yes, nice tip.
Thanks.
And, poor you, getting fed up with house crash threads (while starting yet another). How about you put up with 10 years of irresponsible price rises.
See how you like them bananas.
Flaming whingers...
Where the bloody hell have you been meanmachine?
You bought a home yet?0 -
TBeckett100 wrote: »I am getting a little fed up with HPC threads and doom and gloom.
I agree we are ending a bull run but I suspect that the fears are eScalated by the fast access to news online and forums which sends people into a blind panic and sets their expectations low. These forums now encourage people to make heavil reduced offers and sellers who are anxious and believe in a HPC are selling low, compounding the problem. The HPC were are seeing (in reduced terms) in my opionion is being generated by news and consensus.
So what caused the crash of 1989?
I was there and remember it well. There was no internet, just the telly and the papers. No-one predicted a crash in house prices - it just happened. When I sold to rent in late 1989 everyone thought I was mad...TBeckett100 wrote: »If we look at our landscape, we are an island. It isnt going to get bigger and we have a shortage. Since we cant access more land, keep tight control on greenfield sites and have a need for housing, demand still outstrips supply.
Just like 1989...TBeckett100 wrote: »In addition, I dont realistically think mortgage lenders will be lending 80+ if they see a 40-50% crash. The risk is too huge.
Therefore my opinion is that if your on the ladder keep moving, if you are a first time buyer,prepare to stay in that first home for 5 or so years.
Mortgage lenders aren't lending 80+ now! First time buyer are pretty well extinct as a consequence, and without them who are second time buyers going to sell their houses to?
The market is in stalemate and will remain so until asking prices start falling by 30-40%. But that will take a couple of years yet.
I wouldn't like to be an estate agent!0 -
Walter J..
"So what caused the crash of 1989?
I was there and remember it well. There was no internet, just the telly and the papers. No-one predicted a crash in house prices - it just happened. When I sold to rent in late 1989 everyone thought I was mad..."
It just happened ....
Remember this?
1. Inflation was 9% and peaked at about 11%
2. Interest rates peaked at 15%
3. We were members of the ERM (Exchange rate mechanism). countries agreed to keep there currencies within set limits linked to Germam DM and the DM was king. We left as we couldn't stay within the parameters. The value of sterling fell through the floor.
4. High unemployment
5. Affordability of housing - mortgages cost on average 36% to 40% of gross income (ours was 50% at interest rate high)
The ecomony was an absolute mess, interest rates didn't increase by 1/4% or 1/2% they usually increased by 1 or 2% at at a time.
It didn't "just happen"0
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