The 70% club

chucky

dervish wrote: »

exactly - what goes up MUST go down.

A better analogy would be to consider the prices of digital watches when they first came out.

and that had nothing to do with research and development and the cost of large scale manufacturing.
those japanese pople were so clever weren't they Dervish!!!

RDB

The house price boom of the late 90s to 2007 was arguably the biggest suckers rally in history. It convinced many people that wildly overpriced houses represented a new reality. The fact that many people were buying houses they could not afford did not matter. In a rising market, the lenders could always recover the outstanding loan when borrowers defaulted.

Houses will never return to 2007 prices (in real terms). They will fall until lenders feel safe again (3 to 4 times earnings). Thereafter, they will track inflation. I also suspect there will be a fair bit of overshoot on the way down.
Anyone who is hoping for another roller coaster is going to be out of luck. Lenders have come close to bankrupting the world (and we are still not out of the woods, it could still happen). Banks will never be given the freedom to lend again like this.

If you are trying to get a house at the best price, I should wait a few years. Renting is comparatively good value and getting cheaper(especially in London rents are going to fall a long way). House prices are a one way bet for the next few years. If you are looking to make money, I think you are probably 15 years too late.

Some of the biggest price falls are shown here, but I still think prices have long way to fall.

http://www.propertysnake.co.uk/

chucky

RDB wrote: »

The house price boom of the late 90s to 2007 was arguably the biggest suckers rally in history. It convinced many people that wildly overpriced houses represented a new reality. The fact that many people were buying houses they could not afford did not matter. In a rising market, the lenders could always recover the outstanding loan when borrowers defaulted.

Houses will never return to 2007 prices (in real terms). They will fall until lenders feel safe again (3 to 4 times earnings). Thereafter, they will track inflation. I also suspect there will be a fair bit of overshoot on the way down.
Anyone who is hoping for another roller coaster is going to be out of luck. Lenders have come close to bankrupting the world (and we are still not out of the woods, it could still happen). Banks will never be given the freedom to lend again like this.

If you are trying to get a house at the best price, I should wait a few years. Renting is comparatively good value and getting cheaper(especially in London rents are going to fall a long way). House prices are a one way bet for the next few years. If you are looking to make money, I think you are probably 15 years too late.

Some of the biggest price falls are shown here, but I still think prices have long way to fall.

http://www.propertysnake.co.uk/

great copy and paste effort
http://forums.moneysavingexpert.com/showpost.html?p=18871503&postcount=437
have you thought of varying your posts?

dervish

chucky wrote: »

and that had nothing to do with research and development and the cost of large scale manufacturing.
those japanese pople were so clever weren't they Dervish!!!

no - digital wathces like all other products were overpriced at first and then the proces got lower becuase people REFUSED to buy them for stupid money.

The same will / has happened with house prices.

chucky

dervish wrote: »

no - digital wathces like all other products were overpriced at first and then the proces got lower becuase people REFUSED to buy them for stupid money.

The same will / has happened with house prices.

Big D - you didn't get the question in the first place, let me try again...

don't you think that it had more to with research and development and the lower cost of large scale manufacturing for the price drops?

ukcarper

In 1972 house prices almost doubled and that was with banks+ and BSs sticking to 3 to 4 times multipliers.

davilown

ukcarper wrote: »

In 1972 house prices almost doubled and that was with banks+ and BSs sticking to 3 to 4 times multipliers.

Doubling was fine but haven't we seen quadrupling of house prices over a 10 years period? Wages haven't quadrupled so how can house prices stay where they were in 2007. The can't.

ukcarper

That was in one year and wages certainly didn’t double in that year. My point is that nobody really knows what will happen to house prices and I was just pointing out that even without mad multiple values house prices can still increase at a silly rate.

mitchaa

macaque wrote: »

http://money.uk.msn.com/investing/articles/nicklouth/article.aspx?cp-documentid=10924988

A year ago I suggested that a house price correction in the region of 70% might be on the cards. People's reaction to this was ridicule and contempt. With each passing month however, more and more people have been joining the 70% club.

Whilst this is not particularly welcome for home owners, (and a catastrophy for heavily leveraged BTLs) it is good news for the country. High house prices have been socially divisive and damaged the long term stability of our economy.

You got 17 thanks for that initial post..

ad9898 (13-11-2008), brit1234 (14-11-2008), bubblesmoney (15-11-2008), chief (15-11-2008), chrisandanne (13-11-2008), dopester (13-11-2008), fatpig (13-11-2008), geoffky (09-02-2009), mower5 (09-02-2009), neverdespairgirl (13-11-2008), penguine (15-11-2008), Pobby (09-02-2009), purch (13-11-2008), Sapphire (16-11-2008), staffsuk (13-11-2008), TD5 (14-11-2008), Wookster (09-02-2009)

Would the same people still agree with this 70% idea or have opinions changed since then

JonnyBravo

RDB wrote: »

The house price boom of the late 90s to 2007 was arguably the biggest suckers rally in history. It convinced many people that wildly overpriced houses represented a new reality. The fact that many people were buying houses they could not afford did not matter. In a rising market, the lenders could always recover the outstanding loan when borrowers defaulted.

Houses will never return to 2007 prices (in real terms). They will fall until lenders feel safe again (3 to 4 times earnings). Thereafter, they will track inflation. I also suspect there will be a fair bit of overshoot on the way down.
Anyone who is hoping for another roller coaster is going to be out of luck. Lenders have come close to bankrupting the world (and we are still not out of the woods, it could still happen). Banks will never be given the freedom to lend again like this.

If you are trying to get a house at the best price, I should wait a few years. Renting is comparatively good value and getting cheaper(especially in London rents are going to fall a long way). House prices are a one way bet for the next few years. If you are looking to make money, I think you are probably 15 years too late.

Some of the biggest price falls are shown here, but I still think prices have long way to fall.

http://www.propertysnake.co.uk/

Yet today (Thursday 2nd April) you have advocated getting into silver and linked to an article claiming there is going to be another "super spike" at some point over the next 10 years......

http://forums.moneysavingexpert.com/showthread.html?t=1601083

Can you not see the similarities? Are you relying on an equally big "suckers rally" and are you in on silver already hence your interest?