The 70% club

PayDay

IveSeenTheLight wrote: »

I therefore very much doubt 70% is even a remote possibility, but if they do, I'll buy 3

How? You have already told us that you have only got enough for 3 months if you lose your job. Even allowing for your tenants keep paying their rent, that still leaves you well short of being able to buy 3.

70% drop seems too far imo, but who knows where this will all end. 50% would be my guess, but from my own personal standing of owning three houses, I hope it won't be that low. I can see how it would benefit a lot of people if they do drop by 50 -70%. I'm just very grateful that I haven't got any debt coming in to this recession.

fatpig_2

PayDay wrote: »

How? You have already told us that you have only got enough for 3 months if you lose your job. Even allowing for your tenants keep paying their rent, that still leaves you well short of being able to buy 3.

.

He's a Billy Bullshiner. Here's one of the 3 houses he's buying: :rotfl:

besonders1

70% does seem a bit optimistic but then again since the late 90s house prices did treble in value but sadly wages (esp the minimum wage and people on a low income) are not much more today.
The problem is that only a few people are cash buyers who can purchase a home outright and I have seen many fantastic reductions out there and people have put in offers only to be turned down for a mortgage.
There would be less risk for banks if the house prices came down to year 2002 prices and would probably get the market moving again. I suppose no one really knows what the new generation of house prices and valuations will be but then banks must also play a part in it as well as to how much they will lend.

ad9898_3

Ewarwoowar2 wrote: »

Given that we're being told that this could be the worst economic crash since WW1, the crash in property prices could be worse than the 1970's, 1980's and 1990's. Therefore, the above logic would suggest that a crash of 70% is not a foolish perdiction


Anyone care to point out why the above is incorrect?

mmmmmmmm looking at the graph again..... No:D

Dan:_4

Houses are now almost affordable to the average FTB, couple that with low interest rates, buyers will soon be flocking into the market to pick up a bargain.

25% from peak - a possibility (but I still wouldn't bet on it)
70% from peak - not a chance

PayDay

Dan: wrote: »

Houses are now almost affordable to the average FTB, couple that with low interest rates, buyers will soon be flocking into the market to pick up a bargain.

House prices are predicted to drop as are mortgage rates. Why will FTBers buy now when then can buy one much cheaper later?

dopester

Dan: wrote: »

Houses are now almost affordable to the average FTB, couple that with low interest rates, buyers will soon be flocking into the market to pick up a bargain.

25% from peak - a possibility (but I still wouldn't bet on it)
70% from peak - not a chance

Tell that to my next-door-but 2 neighbour.... working at BT. Perhaps his job is safe... for now. Others aren't so lucky, and the luck will run out for many more. Simple pay-cuts will be welcomed next to unemployment... especially so with deflation making other stuff cheaper to buy.

LOL ISTL. You're already committed with debt levels on two houses, and another abroad. A 70% crash would put you in the hole (not laughing at prospect of that) and unlikely to make you any sort of good credit risk for more money, as you service existing debt.

That is how it works. Mitchaa talks about putting houses on her credit cards, but that isn't going to happen if you're already sunk with debt in one property that has crashed out in price. Those with money decide the prices from now on.

StevieJ

PayDay wrote: »

House prices are predicted to drop as are mortgage rates. Why will FTBers buy now when then can buy one much cheaper later?

You lot have been working that line for about 18 months, how does it go ' You can fool come of the people etc blah blah'

StevieJ

Dan: wrote: »

Houses are now almost affordable to the average FTB, couple that with low interest rates, buyers will soon be flocking into the market to pick up a bargain.

25% from peak - a possibility (but I still wouldn't bet on it)
70% from peak - not a chance

Down 20% by April, 70% I will be in like a shot.

Dan:_4

PayDay wrote: »

House prices are predicted to drop as are mortgage rates. Why will FTBers buy now when then can buy one much cheaper later?

Because most potential FTBers do spend time on MSE and/or researching the housing market. They see a bargain they can afford - and simply go for it.