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Debate House Prices
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A postcard from the 70% club
macaque_2
Posts: 2,439 Forumite
Are we seeing house price stabilisation? Yes
Have we seen the end of house price falls? No
Have we seen the worst of house price falls? No
Lenders need buyers to pick up properties from distressed sellers and prevent a rapid crash. Buyers with big deposits shift the risk from the lender to the borrower. Low base rates give lenders the perfect tool to lure unwary buyers with big deposits. As bait, lenders are offering incredibly attractive short term rates. Many are falling for this.
Vested interests describe property as very affordable at the moment. This patent nonsese is based on an assumption that artificially low interest can last. Measured against long term interest rates house prices are still hopelessly over priced.
The government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.
Have we seen the end of house price falls? No
Have we seen the worst of house price falls? No
Lenders need buyers to pick up properties from distressed sellers and prevent a rapid crash. Buyers with big deposits shift the risk from the lender to the borrower. Low base rates give lenders the perfect tool to lure unwary buyers with big deposits. As bait, lenders are offering incredibly attractive short term rates. Many are falling for this.
Vested interests describe property as very affordable at the moment. This patent nonsese is based on an assumption that artificially low interest can last. Measured against long term interest rates house prices are still hopelessly over priced.
The government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.
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I've missed a link in the chain... Why will inflation increase?
The government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.0 -
LOL I thought all those silly enough to think (average) prices would fall 70% were long goneChuck Norris can kill two stones with one birdThe only time Chuck Norris was wrong was when he thought he had made a mistakeChuck Norris puts the "laughter" in "manslaughter".I've started running again, after several injuries had forced me to stop0
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And how many unwary FTBs have big deposits??Thrugelmir wrote: »Who is offering bait?0 -
The government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.
And Brown, no longer being PM, will look us in the eye with pseudo-dignity, and say, 'Not my fault, hard-working British people!' :rotfl:0 -
The government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.
As I posted yesterday, I see this as the '3rd' leg down in the housing ponzi scheme, the first leg is playing out as we speak, insolvent banks and tight lending have bought about 20% falls so far, the 2nd leg will be unemployment, which will become a more of a factor towards the end of this year, through 2010, the 3rd leg will be mild inflation, peak oil, wary foreign investors, huge tax hikes, and as yet the 'untouched public sector', which will be demolished after the next election, as we desperately try to fend off going to the IMF.
It will fail and the IMF will be called in 2011, pushing rates up, and bringing house prices down to the trough of around 90-100k. If you still have a job, then that will be the time to buy, it's a 'big if' though, I admit, as I expect unemployment to be pushing 4 million by then.0 -
Are we seeing house price stabilisation? Yes
Have we seen the end of house price falls? No
Have we seen the worst of house price falls? No
I take it this is your own opinion.
There are many reports out there suggesting the worst of the economic recession is behind usLenders need buyers to pick up properties from distressed sellers and prevent a rapid crash. Buyers with big deposits shift the risk from the lender to the borrower. Low base rates give lenders the perfect tool to lure unwary buyers with big deposits. As bait, lenders are offering incredibly attractive short term rates. Many are falling for this.
You make it sound like buyers are stupid, but I see what you are trying to imply.Vested interests describe property as very affordable at the moment. This patent nonsese is based on an assumption that artificially low interest can last. Measured against long term interest rates house prices are still hopelessly over priced.
Whenever I have quoted affordability, it is based on house price - earning ratio, not on low interest rates.
You are correct however that mortgage repayment affordability should be a high consideration and definately consider the costs at higher rates.
House prices are at the long term trend (includes previous crashes).
What VI's like yourself are hoping for is not a stabalisation in house prices, but a continuation of house prices to go wildly above and below that long term trendThe government faces mammoth borrowing requirements over the next few years. As inflation grows and sterling slides this will drive interest rates up. It is quite possible that we will see interest rates in double figures by 2011. We have to wait for this process to kick in before we see the really big house price falls.
While it is quite possible to see double digit interest rates, even by 2011. Somehow I don't quite see it.
We are already almost half way through 2009 with no real sign of interest rates to rise in the short future.
While anything is possible, I don't see at the moment double digit interest rates by 2011.
One thing to consider if anyone is a homeowner, is to look to secure a lon term fix when you see interest rates rise.
I'm sure this can be secured long before double digit interest rates arrive.
I've not checked for a while, but I'm sure I've read on here 5 and 10 year fixed rates at 5-6%. Surely your not saying this is too high:wall:
What we've got here is....... failure to communicate.
Some men you just can't reach.
:wall:0 -
Thrugelmir wrote: »Who is offering bait?
HSBC are offering a rate of 2.49% fixed for 2 years but.......... you need to have a deposit of 40%.0
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