Daily Telegraph joins the 70% club

sabretoothtigger

StevieJ wrote: »

Good job we can still live in that lill ole house whatever the value :j

Thats what Im waiting for, the real value and use of these houses will determine the bottom line not the newspapers or opinion but where do people want to rest their heads at night is about as basic and non speculative as things get

I think a parrallel indicator will be rental activity and prices, if rents plunge then sure I'll believe some of the headlines otherwise people will jump from renting back into ownership because personally I think thats what people prefer, I know I do.

I do agree with government trying to restart mortgage loans but only in a sensible way.
As well as no 100% loans, they should stop discounted rates at the start of a mortgage as that also was a factor in allowing unsuitable lending to occur for a few years before collapasing

sabretoothtigger

The buy to let sector HAS ALREADY TRIGGERED A CRASH IN UK HOUSE PRICES, as I warned of in November 2007( Crash in UK House Prices Forecast for April 2008 As Buy to Let Investors Sell on Capital Gains Tax Change), that was forecast to begin in April 2008.

To imply now, more than 18 months INTO the bear market that the buy to let sector will ACCELERATE the ongoing crash is frankly just an attempt to grab headlines, as the rate of decent is expected to slow during the year inline with the currency depreciation and return of inflation.

The pertinent time to make such a forecast or observation was more than a year ago.

While I agree house prices are some distance away from a bottom, however UK House prices in U.S. dollars and euro terms have already crashed by more than 50%

http://www.marketoracle.co.uk/Article9386.html

chucky

oh dear... how much of the UK market is BTL?? it's less than 10%.
do you really think that was the cause of HPI

as for the 55% rubbish - it's a prediction. already a non-story
http://forums.moneysavingexpert.com/showthread.html?t=1551317

dopester

Chucky - my general view is markets decide the value of stock or an asset, by the prices bid or sold by those who are actively trading.

That doesn't mean all holders of stock, or property, are actively trading. The only thing which affects prices/value are the people who do buy and sell. With stocks, if those traders decide to buy at higher prices than the week before, it raises the value of the shares for all existing stock-holders. It some people who own the shares decide to accept lower prices than before, it lowers the value of the shares for all those who hold shares.

Some people have lived in their homes for decades, yet the prices of their own homes rocketed up massively in the boom, each year, as new buyers - be they BTLers or people trading up - agreed to buy similar property for ever higher prices in their areas.

It is my view that it only took a small percentage (overall, compared to housing stock) of liar-loans, and BTL competing fever, with access to the finance to allow their investing decisions at ever higher prices to take place - to really hyper-zoom-up the "value" of all houses in the last 8 years hyper-boom.

It is how markets work.

chucky

agreeing that all of them are factor but i think you've missed the biggest driver of HPI - the credit that was available to all and sundry to leverage themselves into more debt.

less than 10% of properties being bought isn't enought to generate 200% worth of HPI