Property prices will have stabilised by this time next year. Yes or NO?

skap7309

Continuing to decline past 12 months. My reasons?

Prices have been falling for over 12 months already in most cases and sellers are only just beginning to remove their heads out of the sand. It took a long time to start seeing falls as i am sure it did for many people. 12 months ago really does not seem long at all from where it all began.

Second - the economic crisis is far from stabilizing and we can expect years, not months, of this remaining. House prices will of course go hand in hand.

Third - houses are still overpriced and buyers are becoming more savvy and realising this now. Consumer confidence is at the lowest it has been for years and the power of the internet and 24 hour media is essential for information but does not help the case.

Fourth - The stamp duty 'holiday' will come to its end - a small flurry of activity will occur and then be even worse than it is now. Panicking - Darling extends the 175k threshold for another 12 months. If this does not occur i will eat own words....it is what the government does best.

skap7309

Just one more thing - in the poll does 'stable' mean 0% +/- or as the media like to say falls are stabilizing to -1.8% PM? :rotfl:

neverdespairgirl

StevieJ wrote: »

The point is that after the Yon Kippur politics finished the price stayed high.

You remember you were gratuitously rude to Generali about Barker / Barber?

It's Yom Kippur, go and have your hair cut.

stevetodd

My best guess is that the market will not hit the bottom for at least 18 months, and that's all we are doing ie guessing at the moment. The autumn is usually quite a dampened season for the housing market, I think late spring/early summer 2010 is much more likely

Jaymz

I still think they will be dropping this time next year. The rate of fall at the moment is pretty steady and apart from the odd big drop there hasn't been huge falls.

Next year is going to be an interesting year if you own a property you need to sell or if you are a FTB (like myself) who is looking to get a bargain

StevieJ

neverdespairgirl wrote: »

You remember you were gratuitously rude to Generali about Barker / Barber?

It's Yom Kippur, go and have your hair cut.

It's a fair cop.

Generali

StevieJ wrote: »

No, I think they wised up that they could achive higher prices for a dwindling resource and basically increased the prices that then stayed at the higher levels. Israeli politics was also involved but I think this was more of sideshow. The point is that after the Yom Kippur politics finished the price stayed high. I think at the time there was greater dependency on the Middle East for oil than now.

There was much higher dependancy on the Middle East for oil. Also, oil was used far less efficiently - each 'unit' of GDP took far more oil to create today than it did in the 70s. AIUI, it was the 1970s oil shocks that started the move towards using oil more efficiently.

It looks like we're both right:

http://en.wikipedia.org/wiki/1973_oil_crisis

The 1973 oil crisis began on October 15, 1973, when the members of Organization of Arab Petroleum Exporting Countries (OAPEC, consisting of the Arab members of OPEC plus Egypt and Syria) announced an oil embargo "in response to the U.S. decision to re-supply the Israeli military during the Yom Kippur war." OAPEC declared it would no longer ship oil to the United States and other countries if they supported Israel in its conflict with Syria, Egypt and Iraq. At the same time, OPEC members agreed to use their leverage over the world price-setting mechanism for oil in order to raise world oil prices, after the failure of negotiations with the "Seven Sisters" earlier in the month. For the most part, industrialized economies relied on crude oil and OPEC was their predominant supplier

Austin_Allegro

StevieJ wrote: »

This market was stopped dead by the credit crunch ( before prices had found a higher level), it will be stabilised by the dissipation of the credit crunch. Remind me when were house price increases last stopped in their tracks by such a dramatic withdrawal of credit? We can then discuss the historical perspective.

To paraphrase Scooby Doo, 'if it wasn't for that pesky credit crunch I might have gotten away with it'.

I don't believe the credit crunch is some kind of external phenomenon that somehow stopped HPI in its tracks, like a war or a volcano erupting. It's an inherent part of the whole HPI bubble.

HPI grew so much in the US that it collapsed under its own weight, loans went bad and this spread everywhere else via CDOs.

Even if the credit crunch were some external phenomenon that could be overcome, it would still not affect the fact that house prices in the UK had reached the peak of affordability. This peak was artificially raised via BTL and dodgy instruments like IO mortgages, shared ownership etc. Without concomitant wage inflation, prices simply could not have risen any higher, even if the banks had managed to survive such madness.

To put it simply, the credit crunch didn't cause the house price crash, because the credit crunch is the house price crash.

chucky

Austin_Allegro wrote: »

To paraphrase Scooby Doo, 'if it wasn't for that pesky credit crunch I might have gotten away with it'.

I don't believe the credit crunch is some kind of external phenomenon that somehow stopped HPI in its tracks, like a war or a volcano erupting. It's an inherent part of the whole HPI bubble.

HPI grew so much in the US that it collapsed under its own weight, loans went bad and this spread everywhere else via CDOs.

Even if the credit crunch were some external phenomenon that could be overcome, it would still not affect the fact that house prices in the UK had reached the peak of affordability. This peak was artificially raised via BTL and dodgy instruments like IO mortgages, shared ownership etc. Without concomitant wage inflation, prices simply could not have risen any higher, even if the banks had managed to survive such madness.

To put it simply, the credit crunch didn't cause the house price crash, because the credit crunch is the house price crash.

you probably need to add the lack of Regulation to the above.

if there were good enough regulation of what constituted CDO's and other Debt instruments there would be visibility and any House Price Crash would have minimal impact on Global Markets as we would know what losses would happen. therefore no "Crash".

however, there was no Regulation and banks are in the mess that they are...

WTF?_2

Austin_Allegro wrote: »

I don't believe the credit crunch is some kind of external phenomenon that somehow stopped HPI in its tracks, like a war or a volcano erupting. It's an inherent part of the whole HPI bubble.

..

To put it simply, the credit crunch didn't cause the house price crash, because the credit crunch is the house price crash.

Post of the week! :money::money::money::money:

That is what many of the 'cut cut cut brigade' here don't seem to get.

It's the market attempting to restore itself to something like equilibrium - it has been pumped to bursting point by more and more spurious credit creation over much of the last decade, and particularly since 2001.

Forget about trying to make borrowing as cheap and easy as it was until recently. Credit needs to be more expensive and harder to get than it previously had been at the peak of the bubble.

The priority is to let the fundamentals of the market get back to something approaching stability as quickly as possible, whilst averting total collapse as it snaps back from the breaking point caused by super-lax credit and irresponsible lending.