sold for 40% less than construction costs.

crazygaijin

3161 Michelson Drive, a delightful-looking office block just a short drive from the Orange County airport has just sold for $160m, or about $300 a square foot. That's 40% less than its construction cost: note we're not talking about 40% less than its peak value but 40% less than the actual cost of the materials and labour used to put the thing up in 2007.
That's beginning to look like the kind of deal you only see in very nasty depressions – the kind of deal we haven't seen much of since the commercial property nightmare of the 1930s


http://www.moneyweek.com/investments/property/property-deals-arent-pointing-to-a-quick-recovery-14915.aspx


A reminder, were one needed, that, in a credit crunch, a building is only worth what someone with cash is prepared to pay for it.

97trophy

It matters because the fate of the banks is inextricably linked to US property prices: as long as they are falling, we know the banking crisis isn't nearly over

For me this is the most convincing bearish argument.

Nylontokyo

Yes it anoys me when people say oh but thats America, its different here!

Dont they realise that we are affected by everything. Just a few years behind the yanks.

Soon property like this will be sold for less than it costs to build here in the UK.

Norfolk_Jim

When swine bird flue inevitably arrives and kills off half the population there will be such a glut of empty property you'll hardly know what to do with it all. When that happens, buy up all the houses you can in Cumbria and Northumberland in advance of the enormous demand that'll be generated by the London dirty bomb disaster.

StevieJ

Yes, OK :rolleyes:

hearts

If all/any of the things suggested here happen, I wouldn't worry, we'll all be fooked anyway.

adr0ck

Norfolk_Jim wrote: »

When swine bird flue inevitably arrives and kills off half the population there will be such a glut of empty property you'll hardly know what to do with it all. When that happens, buy up all the houses you can in Cumbria and Northumberland in advance of the enormous demand that'll be generated by the London dirty bomb disaster.

and when most of england floods property prices in wales and scotland will sky rocket

sabretoothtigger

Someone got a bargain there I guess

Nylontokyo wrote: »

Yes it anoys me when people say oh but thats America, its different here!

Dont they realise that we are affected by everything. Just a few years behind the yanks.

Soon property like this will be sold for less than it costs to build here in the UK.

Things that do vary are population density, bankruptcy law, property taxes, planning laws and we have a longer history of house ownership rather then renting

Might be worse even but its simplistic to say it'll be just the same here. Imo we have greater long term demand overall

blakester

Norfolk_Jim wrote: »

When swine bird flue inevitably arrives and kills off half the population there will be such a glut of empty property you'll hardly know what to do with it all. When that happens, buy up all the houses you can in Cumbria and Northumberland in advance of the enormous demand that'll be generated by the London dirty bomb disaster.

You're a little ray of sunshine Jim:rotfl: