House price futures - average house at £117k in 2011

penguine

I don't think 40% drops will tempt me, though I may have trouble convincing my OH to wait a bit longer. I look at our flat, which was valued at £200k early in the year (though told it was more likely to get £180k) and I think, really, it shouldn't be worth more than £90k because that would be a reasonable price for a first time buyer on an average salary. So that means house prices in our area need to fall by at least 50% to reach sustainable levels.

penguine

GDB2222 wrote: »

They also mention that some spectators think that's overdoing the gloom, and they suggest that those spectators should put their money where their mouth is.

Is that clearer now?

Yes, thanks.

Gorgeous_George

In the past, interest rates and affordability drove prices ever higher. Nowadays, with lending multiples and LTVs being trimmed to the bone, prices need to fall for people to be able to buy.

Mid to long term, I think more houses will enter the BTL arena as the number of people who can obtain credit (or who wish to obtain credit) reduces. Hence the need for urgent, but well-thought out, Landlord Licencing.

GG

Kez100

penguine wrote: »

I don't think 40% drops will tempt me, though I may have trouble convincing my OH to wait a bit longer. I look at our flat, which was valued at £200k early in the year (though told it was more likely to get £180k) and I think, really, it shouldn't be worth more than £90k because that would be a reasonable price for a first time buyer on an average salary. So that means house prices in our area need to fall by at least 50% to reach sustainable levels.

I can understand that attitude with flats (unless in London)

mitchaa

ad9898 wrote: »

i think Carol covered all the bases their. It wasn't long ago that 25% off peak was thought of as cloud cuckoo land, now 25% is mainstream.

40% is slowly starting to creep in to forecasts, although still thought by some as cloud cuckoo land. I expect 40% to become mainstream over the next 6 months.

I still believe as a national average 40% is still cloud cuckoo. That would require some areas to fall a lot harder to maintain that figure as of course not all areas will drop by anywhere near 40%. (The NE of Scotland as an example )

25% and that will be your lot;) I believe the LR figures are currently 'only' showing 8% drops from peak, so a long way to go before we get anywhere near 40%

Nationwide and Halifax figures showing just under 15% from peak but they are a small minority and only make up just over 25% of the mortgage market.

I'll stick to my 25%

ad9898_3

Gorgeous_George wrote: »

In the past, interest rates and affordability drove prices ever higher. Nowadays, with lending multiples and LTVs being trimmed to the bone, prices need to fall for people to be able to buy.

Mid to long term, I think more houses will enter the BTL arena as the number of people who can obtain credit (or who wish to obtain credit) reduces. Hence the need for urgent, but well-thought out, Landlord Licencing.

GG

More houses may well enter ther arena, however how many LL's will be left to snap them up? BTL has risen 35 fold since '97, I would hazard a guess that a significant majority of these are amateurs (there is one on the Housing Board now thats in trouble).

I concur that BTL will reduce significantly over the coming years as these amateurs get out/go bankrupt and not return, leaving only more astute LL's left. With there being less LL's they will have less of an impact on the market.

We know this, as certainly in the last few years FTB'rs have been virtually non existent compared to historical data. Property chains have only been completing because of BTL investors at the bottom, which have now disappeared, hence very few transactions. I know this as there are hundreds of houses for sale in my area alone, yet none are selling, sky high prices and no one at the bottom to start the chain are the cause.

ad9898_3

mitchaa wrote: »

I still believe as a national average 40% is still cloud cuckoo. That would require some areas to fall a lot harder to maintain that figure as of course not all areas will drop by anywhere near 40%. (The NE of Scotland as an example )

25% and that will be your lot;) I believe the LR figures are currently 'only' showing 8% drops from peak, so a long way to go before we get anywhere near 40%

Nationwide and Halifax figures showing just under 15% from peak but they are a small minority and only make up just over 25% of the mortgage market.

I'll stick to my 25%

Yes but LR is 3 months behind (I think) and is fast catching up, weren't prices down over 4% alone last month on the LR ? I stand to be corrected.

Kez100

mitchaa wrote: »

I still believe as a national average 40% is still cloud cuckoo. That would require some areas to fall a lot harder to maintain that figure as of course not all areas will drop by anywhere near 40%. (The NE of Scotland as an example )

25% and that will be your lot;) I believe the LR figures are currently 'only' showing 8% drops from peak, so a long way to go before we get anywhere near 40%

Nationwide and Halifax figures showing just under 15% from peak but they are a small minority and only make up just over 25% of the mortgage market.

I'll stick to my 25%

Until we look back no one will know.

The 40% won't just vary across areas it will vary depending on type of property. So, studios, for example will likely suffer the worst and overpriced apartments. All that falls into the mishmash of 'average prices'

LR is a useless statistic as it is so far behind this volatile market and continued quoting of it blows your argument off course. I would avoid it if I were you for a while. Mortgage Lenders also do not show true value of the market drops because it is not being calculated based on a true market. It consists at the moment of very few sales. The true drops if we want a proper level of sales is much lower but we dont see it in statistics because buyers are saying 'no way' and sellers are keeping their head in the sand.

Try looking at the predictions and assessing them alongside logic - then you can a bit of positive sentiment (no problem with that) and quite possibly you'll end up with your 25%.

In a decade we will know for sure!

mitchaa

Kez100 wrote: »

Until we look back no one will know.

The 40% won't just vary across areas it will vary depending on type of property. So, studios, for example will likely suffer the worst and overpriced apartments. All that falls into the mishmash of 'average prices'

LR is a useless statistic as it is so far behind this volatile market and continued quoting of it blows your argument off course. I would avoid it if I were you for a while. Mortgage Lenders also do not show true value of the market drops because it is not being calculated based on a true market. It consists at the moment of very few sales. The true drops if we want a proper level of sales is much lower but we dont see it in statistics because buyers are saying 'no way' and sellers are keeping their head in the sand.

Try looking at the predictions and assessing them alongside logic - then you can a bit of positive sentiment (no problem with that) and quite possibly you'll end up with your 25%.

In a decade we will know for sure!

But then why is so much credibility put into the Nationwide figures when they only account for 7% of UK mortgages? Or the Halifax figures when they only account for 20%?

At least LR (Although lagging) are confirmed house sale prices. This will eventually catch up and show the drops in a bigger picture. They may well in 2-3mths show what Nationwide/Halifax are showing today, but on the other hand they may not.

You are correct it definitely depends on the type of house and its location, i would expect to see 40% falls, perhaps a little more on overpriced ''luxury'' apartments/flats.

ess0two

Whats an average house.............

3 bed semis can be had for as little as £125k in my area,also 2 bed terrace @ £75k