Next Year 40% of Buyers Will Be CASH Buyers- The Times.

pickledpink

A report in The Times today says that in one year from now 40% of buyers will be cash buyers.

Surely this will make it even harder for people with just a deposit and mortgage offer to negotiate? Every seller likes a cash buyer - we all know that.

So I wonder what effect this will have? I doubt that non-cash buyers will be able to negotiate, and the best bargains will probably be snapped up by those with cash.

http://property.timesonline.co.uk/tol/life_and_style/property/buying_and_selling/article5196748.ece

pickledpink

Sorry.............I posted the whole link.

This is the part where they say that 40% of buyers will be cash buyers byt he end of next year:

....."Savills estate agency predicts that the proportion of cash buyers is set to grow from 25 per cent today to up to 40 per cent by the end of next year, as people with equity start using their spare resources to take advantage of low prices during the downturn."

I think this is very bad for those who won't be able to buy a property outright.

brit1234

Where will all these cash buyers come from. The less pople who can afford to buy the lower prices will come. i suppose the big land lords and strs who sold in 2006-2007 might have a war chest but they were few in number. People with my view point that prices were going to collapse 2007-2008 were in general widely ridiculed till now.

No this means big drops far quicker and bankrupt developers.

ManAtHome

pickledpink wrote: »

....."Savills estate agency predicts that the proportion of cash buyers is set to grow from 25 per cent today to up to 40 per cent by the end of next year, as people with equity start using their spare resources to take advantage of low prices during the downturn."

Ah... so people with equity are going to errrrm, borrow against that equity to "pay cash"... LOL - for everything else...Mastercard.

CLAPTON

just stop buying the times

globalds

brit1234 wrote: »

Where will all these cash buyers come from.

Maybe they will be foreign investors.
Is UK the new Bulgaria ?

dopester

pickledpink wrote: »

I think this is very bad for those who won't be able to buy a property outright.

It is worse for sellers, and all other property owners who aren't even selling, as prices paid in a street or town help set the market rate for your property.

Prices will need to fall to levels where cash purchases are more manageable than they currently are. Less credit about, less cash in the system from the small percentage of people who don't have the bulk of their wealth trapped in illiquid investments.... drive those prices right down.

Davesnave

Those famous weasel words 'up to' are in there, but I guess some people burned in the stock market may feel that investment in bricks and mortar, land, or both, is a better, more tangible, long term bet. Also, there will be STRs coming back into the market if prices drop to what they see as 'satisfactory' levels. I know I won't be happy in rented for more than a year.

Guy_Montag

pickledpink wrote: »

....."Savills estate agency predicts that the proportion of cash buyers is set to grow from 25 per cent today to up to 40 per cent by the end of next year, as people with equity start using their spare resources to take advantage of low prices during the downturn."

I would think:

This year there have been say 500,000 house sales; 25% or 125,000 have been cash buyers.

Next year 40% will be cash buyers, but perhaps only 100,000 of them - giving 260,000 house sales.

Or they could just be making unsubstantiated predictions - never seen that round here. :rolleyes:

lethal0r

what is the correct meaning of 'cash buyer'?

I have heard it mentioned on several occasions that it does not just refer to someone who uses solely their own money to buy a house.

poppysarah

Cash not mortgage I assume it means.

At the peak buying season even being a cash buyer didn't help as EAs would rather sell to landlords who will be continually buying than someone who's just going to buy one.