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interest rates 1% in usa but prices are falling faster

It looks like the cuts will do not a jot to stop falling prices as japan and America have shown us..japan had 0% rates and prices collapsed....just like the pound is going to...god help those who rely on jobs to pay the bills if they are cutting rates this hard.
It is nice to see the value of your house going up'' Why ?
Unless you are planning to sell up and not live anywhere, I can;t see the advantage.
If you are planning to upsize the new house will cost more.
If you are planning to downsize your new house will cost more than it should
If you are trying to buy your first house its almost impossible.

Comments

  • WestonDave
    WestonDave Posts: 5,154 Forumite
    Rampant Recycler
    Prices will fall while people aren't buying as people reduce prices in a vain attempt to find a buyer. Rate cuts can't save the housing market here as the fundamental problem is the shift from 125% mortgages to 90% mortgages. Basically now if you don't have at least £10k in savings you can't buy anything and all the rate cuts in the world won't change that. That in turn takes out most of the first time buyers (apart from those astute enough to see the coming storm and use the time to build up a deposit pot) which in turn stalls the whole market (well most of it there will always be some movement). Quite simply the market won't stabilise until the majority of first time buyers have had time to gear up to saving for a deposit.

    To be fair the rate cuts aren't really about house prices - its more to free money in peoples household budgets to get them spending on goods and services.
    Adventure before Dementia!
  • poppysarah
    poppysarah Posts: 11,522 Forumite
    And saving for your deposit just got that bit harder.
This discussion has been closed.
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