Property crash soon???

tomstickland

I've just been reading this and it mentions shoring up trying to revive economies with cheap money, and the subsequent asset price growth or inflation, and also mentions how it takes a long time for the inflated assets to fall back to normal.
http://news.independent.co.uk/business/comment/article354509.ece

And this
http://news.ft.com/cms/s/189df6cc-bf13-11da-9de7-0000779e2340.html

UK mortgage approvals fell in February for the first time since October 2004, while the March CBI distributive trades survey came in below expectations. National accounts data showed fourth-quarter consumer spending growth was entirely due to lower savings, with disposable income flat.

“Even the pessimists could not have imagined a worse combination of economic data for the UK,” opined Marc Chandler, head of global currency research ar brown Brothers Harriman

Wickedkitten

tomstickland wrote:

Maybe. I've been told by mortgage brokers that I have an unfashionably small mortgage requirement (76K), but I've bought what I consider to be an acceptable FTB flat rather than stretching myself. I want to minimise mortgage costs and also have money free to overpay.

You and me both, we are getting a mortgage for 90 with 10% down and that's nowhere near what we could have borrowed. Certainly not the biggest house but it's more than roomy enough for 2 people and 2 cats.

Pal

One cat each to swing?

Wickedkitten

Pal wrote:

One cat each to swing?

hahaha, its a bit bigger than that and actually has a rear yard as well.

meanmachine_2

NastyMatt wrote:

So, what is people's opinion on what (and when - apart from the isolated case of 1990 - 1995) has consituted a crash?

/flame suit on

Well the "boom" of 1996 to 2006 seems more spectacular than it is because houses were undervalued at the start - by 30%.

They're now overvalued by 30%. So in fact, the boom has only really occured since 2001.

A return to the fundamentals underpinning the market would see a correction by 30%, therefore. It just depends how you get there.

At this rate it might take 20 years.

It all depends on the world banks and their shareholders. If they decide it's more profitable for them to hike interest rates and make money from existing customers than throw cheap money at new customers, then rates will rise accordingly.

It's been a worldwide phenomenon and will either continue or unravel on a worldwide scale. We are but pawns.

wibble68_2

meanmachine wrote:

It's been a worldwide phenomenon and will either continue or unravel on a worldwide scale. We are but pawns.

I'm still amazed by the Great British love affair with property.

Meanmachine has said "We are but pawns". I think the majority
of people in this country are just plain dumb.

I'm sure people will be rejoicing at the media interpretation of today's figures produced by the Nationwide.

With this being another nail in the coffin for a rate cut I wonder if people will one day realize that they can't spend wooden dollars.

robwend

no but i can spend silver coins:D by the bucket so hubby says

tomstickland

Check this

UK mortgage approvals fell in February for the first time since October 2004, while the March CBI distributive trades survey came in below expectations. National accounts data showed fourth-quarter consumer spending growth was entirely due to lower savings, with disposable income flat.

Local paper had an article in the property section tonight saying that mortgage approvals had picked up and the market was speeding up.

Looking at short term thinking, one housebuilder is advertising a deal "we'll pay the difference between your old and new mortgage for 12 months". Then what?
Nice to see some "price reduced" adverts tonight.

If there is a crash then I can just imagine all the bleating and sob stories now "noone told us that interest rates could go up or house prices could go down. We were missold our house" blubba blubba.

wibble68_2

robwend wrote:

no but i can spend silver coins:D by the bucket so hubby says

You sound like a low maintenance wife.

Mine seems to spend £20 notes by the bucket load.

meanmachine_2

tomstickland wrote:

If there is a crash then I can just imagine all the bleating and sob stories now "noone told us that interest rates could go up or house prices could go down. We were missold our house" blubba blubba.

Oh too true.

The same people who attack us property sceptics will be the same ones who - should the market crash - demand compensation for emotional distress. "No one ever warned us" blah blah.

Yes we did. You were too stupid to listen.

Just look at the endowments "scandal". No scandal. You didn't want a repayment mortgage cos it cost more, so you took a risk and you lost.

Tough.