If house prices fall another 37% ...

chucky

penguine wrote: »

The point of the original article wasn't about affordability (however that's defined).

but the PE ratio was mentioned in your first post... which is obviously linked to affordability...

penguine wrote: »

... from current prices, then they will reach the house price to earnings ratio of 3.12 seen in 1995, at the end of the last housing crash.

(That's the lowest ratio they've reached in the past 25 years.)

mewbie_2

whathavewedone wrote: »

You think the tories are going to let them all go bankrupt and lose their homes to save the young FTBs?

I wonder how you think they can buck the market?

Reduce stamp duty :rotfl:
Lower VAT :rotfl:
Increase N.I. :rotfl:
Pay back biggest debt ever :rotfl:
Build more / less / same number of houses :rotfl:
Lower interest rates :rotfl: :rotfl: :rotfl:

Nope. Tell me. How does someone undo a decade of mad lending and a massive bubble? Or just maybe they can't.

StevieJ

carolt wrote: »

Dunno - I wasn't really concentrating.

Let's see - buy house for 100K - goes up to 300K - is that right?

Then loses 57% = 171K, actually, acc to my calculator. So you're right, just under half a 300% increase, actually.

Doesn't really alter my point.

I thought a 300% increase would takes it to 400k , doesn't matter anyway I was being pedantic:cool:

That would equate to 76% of the gain not 50%

Kenny4315

carolt wrote: »

What matters to him is that all property prices continue ever upwards, because if they don't, he'll be in rather a pickle.

Nope, you clearly never read my posts as I have been banging on that a 35% ish correction from peak has been required for about 3 years. As I have said before it would take over an 80% fall from peak for me to NE, but I can see the bigger picture of a 57% fall and it would not be good.

Are you the same person rubbing your hands with glee regarding getting a property of about £300k for under £250k. Rather hypocritical don't you think, the person on the other deal with his wife and kids thrown out into the streets destitute, and living in an old shoe, might not be too impressed with your 'greedy' attitude.

ad9898_3

whathavewedone wrote: »

You think the tories are going to let them all go bankrupt and lose their homes to save the young FTBs?

I'm afraid without FTB'rs your house is worth nothing, unless you can find a BTL'r or a cash buyer to buy it, which would restrict your market somewhat.

mewbie_2

Kenny4315 wrote: »

Are you the same person rubbing your hands with glee regarding getting a property of about £300k for under £250k. Rather hypocritical don't you think, the person on the other deal with his wife and kids thrown out into the streets destitute, and living in an old shoe, might not be too impressed with your 'greedy' attitude.

This is nonsense of course. After all a house is a home, etc. and a drop from 300 to 250 should not be sufficient to bankrupt anybody. They would only be 'thrown out on the streets' if they failed to keep up mortgage payments. Hardly a prospective buyers fault.

For every winner there's a loser. And vice versa. I believe it's called capitalism.

In the bargains section fof this forum (I assume there is one, never been, don't care) people will rechoice at having bought things for less than the retail, or original price. same as eBayers will rechocie at having made a few bob more than they expected.

Let's not have this nonsense about people hoping to buy a cheap, or more honestly, affordable home are somehow lacking in empathy, etc.

Graham_Devon

Kenny4315 wrote: »

Many of these complaining FTB's haven't worked for more than a few years, they have virtually nothing saved, and whinge on that they are 'priced out of the market'. Then expect to just buy the biggest purchase in your with virtually nothing saved. A significant factor in the rise in the first place 125% mortgages, etc.

Whether you like it or not more people will be adversely effected by a 57% than will be positively effected. Many a small business has used capital from there main residence to set up, many a pensioner was plannig to downscale and live comfortably off the difference, to most there wealth is tied into the value of there house. The only ones that may gain if they don't find themselves unemployed, in this scenario with a drop of 57% is renters of an age of 20 to 30, but they don't drive the economics of the country it is those of between 30 and 55 that do, they pay most of the tax, they have most of the property stock, and they are the ones the create most consumer demand thus keeping the economy moving. If you can't see this intuitively then your clueless.

Wow, thats some generalising you got going on there.

Thats why I didn't respond to the rest of the post, including the clueless bit

Kenny4315

mewbie wrote: »

For every winner there's a loser. And vice versa. I believe it's called capitalism.

That's not what you moaning anti-BTL sitting in renting accomodation cry-babies priced out of the market boo hoo ...... suggest when a BTL makes a few bob is it .... :rolleyes:

Kenny4315

Graham_Devon wrote: »

Wow, thats some generalising you got going on there.

Thats why I didn't respond to the rest of the post, including the clueless bit

Not really GD .... most FTB's have not worked as long as those on their second or third home, fact. They won't be buying with as much deposit fact.

The asset value of a property is real in many cases as I have pointed out, fact, divorce, death, children, retirement, etc, all mean movements and generally mean an actual cash sum on sale, or a position where you owe tha bank, and depending on the amount can force bankruptcy. So a significant fall does mean the wider economy is impacted.

Even if you aren't moving the asset value and the equity will determine the rate of interest charge, or whether you can get a deal or not.

Graham_Devon

Kenny4315 wrote: »

Not really GD .... most FTB's have not worked as long as those on their second or third home, fact. They won't be buying with as much deposit fact.

Oh really!?

That means then obviously that they should be priced out of the market and home owners should just keep getting richer through bricks. Couldn't possibly have these people being able to afford a house on a wage, they must suffer for 10 years plus.

Your vested interests and really shining through lovely now. Keep those FTB's in your properties renting lining your pockets.