Experts say wait 5 years to buy back into property

novazombie

Why is this crash taking so much longer than any others in history?

In the 90s crash it only lasted a couple of years and once it started prices fell quite quickly. This time its taking ages.

It started in 2007 and now its 2009 and we are only 20% down. Moneyweek is saying wait 5 years before the bottom. Well thats longer than any other crash ever. Why so long and drawn out this time?

http://www.moneyweek.com/investments/property/its-time-to-get-back-into-property-asian-property-14660.aspx

"I think it will be at least five years before I'd consider buying property in Britain. "

SingleSue

Prices in my area started dropping in 1989...they finished dropping in 1995.

In fact, the house I had reposessed in 1994, only reached the repo price in 1998 after dropping further!

From what I can see, this appears to be dropping faster and harder with the numbers involved, far higher.

For the record, the prices in my town only started dropping last year (our peak was April 08)...but then we are always a bit slow off the mark to start dropping and then slow to start rising too!

mr.broderick

novazombie wrote: »

Why is this crash taking so much longer than any others in history?

In the 90s crash it only lasted a couple of years and once it started prices fell quite quickly. This time its taking ages.

It started in 2007 and now its 2009 and we are only 20% down. Moneyweek is saying wait 5 years before the bottom. Well thats longer than any other crash ever. Why so long and drawn out this time?

http://www.moneyweek.com/investments/property/its-time-to-get-back-into-property-asian-property-14660.aspx

"I think it will be at least five years before I'd consider buying property in Britain. "

Lets hope not everyone is losing their patience.

RDB

SingleSue wrote: »

Prices in my area started dropping in 1989...they finished dropping in 1995.

In fact, the house I had reposessed in 1994, only reached the repo price in 1998 after dropping further!

From what I can see, this appears to be dropping faster and harder with the numbers involved, far higher.

For the record, the prices in my town only started dropping last year (our peak was April 08)...but then we are always a bit slow off the mark to start dropping and then slow to start rising too!

Surely it would be better to get it over with. Get the price back down to the mean long term average where it should be. Everyone knows it will get back there which means most homeowners are going to be in neg equity and millions are going to be reposessed, but lets just get it over with so we can move forward.

SingleSue

I'm not saying either way RDB...I don't own and have no wish to own.

Thought it may be prudent to put a view of what it was like in the last recession, although it has to be said with the proviso that every area is different and some areas will be more harshly impacted than others.

bristol_pilot

The last crash was 5-6 years long.

ShimSham

RDB wrote: »

Surely it would be better to get it over with. Get the price back down to the mean long term average where it should be. Everyone knows it will get back there which means most homeowners are going to be in neg equity and millions are going to be reposessed, but lets just get it over with so we can move forward.

Sound a bit like removing a plaster, very painful.

crazygaijin

The last crash inthe 90s did take more than 5 years to reach bottom.

This time however things are going to be far worse. The average price went far higher above the mean average than it did in the last crash. So will have further to fall which will take longer.

I`d say 5 years from now before bottom is about right (7yrs total). Look at this graph again,

http://www.moneyweek.com/investments/property/uk-house-prices-will-plummet-look-at-this-scary-chart-14664.aspx

we are not even in capitulation yet, we have a long way to fall.

amcluesent

>"I think it will be at least five years before I'd consider buying property in Britain. "<

I would wait until after the civil war.

ad9898_3

Has as been said, in general, the last crash took over 5 years, the decline this time has been quite steep, however the size of the pyramid scheme this time was huge, and with the unwinding of funding back to sustainable levels of 2000-2001, this is where I expect house prices to end up, with a little undershoot.

Price falls will start to moderate though, as vendors desperately try to hold onto high prices, but eventually will capitulate. Nobody likes giving up free money, especially the amount that has been given in this boom, that is why crashes take so long to pan out.

whathavewedone

Q: "why is this crash taking longer than any others in history"?

A: It isn't so far

The 1990s recession wasn't over and done with in 2 years. Don't know who told you that it was but I can assure you it was not. Assume you must have been baby/toddler/small child at the time.