Bad news: house prices are rising

Rochdale_Pioneers

Isn't it obvious what the difference is? The gap between supply and demand has increased. More people need houses - especially small and family sized houses, and fewer houses are available as builders have failed to keep up with demand and have occupied themselves building city apartments for the BTL market.

Wookster

Joeskeppi wrote: »

I'd like to know, on the flipside, why does it have to be the exact same pattern as last time? The news that debt is being paid off at record levels shows to me that lessons have been learnt from the last cycle.

The recession of the 90s was localised, this one is global.
This is a financial crisis, the 90s recession was not.

With these two points combined, how do you think it is possible that the HPC will be less painful than that of the 90s?

bendix

Joeskeppi wrote: »

I'd like to know, on the flipside, why does it have to be the exact same pattern as last time? The news that debt is being paid off at record levels shows to me that lessons have been learnt from the last cycle.

Exactly right. This old chestnut that things follow a nice historical cyclical pattern is just wrong.

History and historical events are not some supernatural, predetermined force. History is no more than the accumulated actions of individuals, and individuals today are different and have fundamentally different motivators today than they had in the 1930s or even early 1990s.

luvpump

Joeskeppi wrote: »

I'd like to know, on the flipside, why does it have to be the exact same pattern as last time? The news that debt is being paid off at record levels shows to me that lessons have been learnt from the last cycle.

Indeed, no one really knows to be fair, not even on these boards :rolleyes: .. One thing is certain the Average house price will be lower at years end than they are now ..

Dan:_4

Wookster wrote: »

The recession of the 90s was localised, this one is global.
This is a financial crisis, the 90s recession was not.

With these two points combined, how do you think it is possible that the HPC will be less painful than that of the 90s?

I think your find that the 1990s recession hit most of the world.

Dan:_4

luvpump wrote: »

Indeed, no one really knows to be fair, not even on these boards :rolleyes: .. One thing is certain the Average house price will be lower at years end than they are now ..

But not as much as some on here would hope.

StevieJ

What do you think will win the Grand National? Try and hide this one in here

DARKNESS for me :cool:

Cannon_Fodder

Joeskeppi wrote: »

I'd like to know, on the flipside, why does it have to be the exact same pattern as last time? The news that debt is being paid off at record levels shows to me that lessons have been learnt from the last cycle.

Unfortunately, BoE's own MEW figures online don't go beyond 2003.

So, I have to point you towards a 'HousePriceCrash' graph, because I couldn't find it elsewhere... http://www.housepricecrash.co.uk/graphs-housing-equity-withdrawal.php

If you note from the figures under the graph, in the 89-95 crash, its was Q4 1992 before MEW was in negative, i.e. being repayed.

So, this time around SOME of the population have learnt quickly.

And that debt being repaid is money that will not be going towards house purchase...which might explain the deeper start this time around, to some degree.

Today's Nationwide figures imply that some sectors of the population have not bargained very hard, or fallen for dodgy pricing, or simply are not too bothered what they pay, they just want that house.

Of course, there will also be cash and high deposit buyers happy enough with 15-20% off, and finding the savings interest no longer matching their rent...for the right house, at the right deal, it could be the right time.

Really2

Cannon_Fodder wrote: »

Of course, there will also be cash and high deposit buyers happy enough with 15-20% off, and finding the savings interest no longer matching their rent...for the right house, at the right deal, it could be the right time.

Can some one get me a glass of water.;)

ukcarper

Really2 wrote: »

One thing I don't get is why 2.2X income will have to be hit?

Was the average wage £25K+ in 1994 that is around the same some on here are stating as the current average.

average FTB purchaes not average house price