House prices fall in June, but still first-time buyers struggle

carolt

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6549935.ece

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They make out that FTB'rs are 'struggling' when they don't ask any, they ask EA's, they ask a Rightmove director (all the usual suspects). Ask me, I'm not cash strapped, I'm not struggling, I'm happy, waiting out the crash to pick up a property at the bottom of the market, I would say the majority of FTB'rs are doing the same.

Who's 'struggling' ?, probably EA's trying to sell at 2007-8 prices, cash strapped vendors who desperately wish it was 2007 again. because 'their property is worth it'.

The answer seems to be simple, if FTB'rs are struggling let the market fall and find it's equilibrium, rather than investing large amounts of borrowed money into manipulating the market.

This part makes me laugh.

There are fears that the increase in the cost of home loans could undermine the tentative signs of stabilisation in the plunging housing market.

In other words, we are scared that we are not able to suck in FTB'rs to take on more debt than would be necessary, than if they just waited for the bottom.

carolt

I disagree. I'm not looking, admittedly, but I suspect I'd find it much harder to get a mortgage now than in 2007, when a small dormouse that could sign its own name could get a half-million quid just like that, with just a teensy weensy lie about its income.

Most FTB's don't have huge deposits; at the bog standard 10% level, or even the perfectly respectable 15% level, rates are significantly higher.

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carolt wrote: »

I disagree. I'm not looking, admittedly, but I suspect I'd find it much harder to get a mortgage now than in 2007, when a small dormouse that could sign its own name could get a half-million quid just like that, with just a teensy weensy lie about its income.

Most FTB's don't have huge deposits; at the bog standard 10% level, or even the perfectly respectable 15% level, rates are significantly higher.

I agree, though the reason is because the RMBS market is closed, and the available lending funds have to be spread thinner while vendors struggle with the reality of their homes losing money.

Once prices come down to an affordable level, the funds won't have to be spread as thinly and people with 10-15% deposit will be able to get a good deal again, the people who won't are the 95-100%'rs, the self cert, liar loaner's...... etc, who, as you say could get a mortgage if they were on the dole a couple of years ago.

bluey890

ad9898 wrote: »

Once prices come down to an affordable level, the funds won't have to be spread as thinly and people with 10-15% deposit will be able to get a good deal again, the people who won't are the 95-100%'rs, the self cert, liar loaner's...... etc, who, as you say could get a mortgage if they were on the dole a couple of years ago.

Prices won't come down to an afforable level for many among the poor and middle classes.

Demand is not abating.

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bluey890 wrote: »

Prices won't come down to an afforable level for many among the poor and middle classes.

Demand is not abating.

Demand will slide once the dead cat bounce finally dies and hits the media, don't forget some people only read the headlines, and they have been fed a right load of bollox over the last 2-3 months. As for the poor and middle classes, mmmm well I'm going to be controversial here, I don't believe 'poor' people are ever likely to be homeowners, or ever were.

bluey890

ad9898 wrote: »

Demand will slide once the dead cat bounce finally dies and hits the media, don't forget some people only read the headlines, and they have been fed a right load of bollox over the last 2-3 months. As for the poor and middle classes, mmmm well I'm going to be controversial here, I don't believe 'poor' people are ever likely to be homeowners, or ever were.

Demand (avoided stating all factors) is rising faster than supply (new builds & extentions). Add in that many LL's now own more than one property (creation of BTL mortgages). And the trend is for a lower percentage of the population will be owning their own home going forward (ignoring government shared ownership schemes).

geoffky

bluey 890...how old are you? is this your first house price crash?

purch

I'm happy, waiting out the crash to pick up a property at the bottom of the market

You'll grow a lot older than you are now, waiting for that to happen.

BTW I would have thought that by now it would be generally accepted that Demand and Supply have very little impact on the price of Housing.

There will be plenty of bounces in the market along the way, but a return to any level of HPI is not going to happen until there is a period of sustained economic growth and subsequent increase in employment levels, neither of which might happen before I draw by pension. (and I'm 48)

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purch wrote: »

You'll grow a lot older than you are now, waiting for that to happen.

I'm cool with that for now, I'm a little younger than yourself, and am enjoying life, owning is not the be all and end all in life, especially in this economic climate

bluey890

geoffky wrote: »

bluey 890...how old are you? is this your first house price crash?

This isn't my first house price crash and I doubt it will be my last.
As for age, I am old enough to satisfy your wife / girlfriend.