So why isn't this possible?

Dan:_4

Thrugelmir wrote: »

I bought late 80's sold early 90's.

Bought 88k
At Peak £125k ( based on next door neighbour)
Sold 88.5k

All in under 5 years.

Thats 42% from peak.

It happened. Some of us witnessed it.

Same as now clever people jumped ship and rented.

Absolutely.

To be clear I was talking about the national average figures.

mbga9pgf

Dan, wage inflation needs to be accounted for as well for the period 1990-95.

Wages for the forseeable are on a downward spiral in the UK faced with deflationary pressure, thus for prices to achieve the required correction for market fundamentals, real prices will haveto fall further this time.

kennyboy66_2

Thrugelmir wrote: »

I bought late 80's sold early 90's.

Bought 88k
At Peak £125k ( based on next door neighbour)
Sold 88.5k

All in under 5 years.

Thats 42% from peak.

It happened. Some of us witnessed it.

Same as now clever people jumped ship and rented.

I don't think you will find many people arguing that certain properties in certain areas will fall significantly - at least 50% and more for city centre flats in Northern cities.

However the Halifax price index (reliable enough) fell by 13% from July 89 to sometime in 1995.

Not 50%, not 20%, but 13%.

I remember the buying scramble in 88/9 before multiple Miras was removed, with 2,3 and 4 people clubbing together to buy a property, particulalrly in London.

Really2

Thrugelmir wrote: »

I bought late 80's sold early 90's.

Bought 88k
At Peak £125k ( based on next door neighbour)
Sold 88.5k

All in under 5 years.

Thats 42% from peak.

It happened. Some of us witnessed it.

Same as now clever people jumped ship and rented.

So one house makes it the norm?

I guess house prices have gone up recently then:)

For the record the nomial peak in the 80s was £62,782 in 1989
Nomianl bottom was 1993 £50,128.

http://www.mortgageguideuk.co.uk/housing/uk-house-price-index.html

There was no average drop of 42% from peak.

Thrugelmir

kennyboy66 wrote: »

Simply not so, most of the write offs of the major banks (not Northern Rock) have been because of commercial lending so far.
Check out the write offs of HBOS and RBS.

That's not to say that there will be material write offs in housing loan book.

I'll reply in more detail tomorrow.

Here's some food for thought. Lending by the UK banks in the first quarter of 2009.

Business £3.7 billion
Mortgages £3.2 billion
Consumer Credit £0.3 billion

Taken from BOE figures compiled from returns made by the major Uk banks - so they cover 65% of business lending and 70& of mortgage lending.

Mortgages make up a far larger share of bank debt than you imagine. Particularly when you factor in securitisation that the crippled banks did.

and 2008

Business Lending £48 billion
Mortgages. £41.6 billion

Thrugelmir

Dan: wrote: »

Absolutely.

To be clear I was talking about the national average figures.

There is no such thing as a national average. Its a notional figure. Not an actual house!

Dan:_4

Thrugelmir wrote: »

There is no such thing as a national average. Its a notional figure. Not an actual house!

Agreed. But it seems many like to discuss and predict the national average on here.

Thrugelmir

Really2 wrote: »

So one house makes it the norm?

I guess house prices have gone up recently then:)

For the record the nomial peak in the 80s was £62,782 in 1989
Nomianl bottom was 1993 £50,128.

http://www.mortgageguideuk.co.uk/housing/uk-house-price-index.html

There was no average drop of 42% from peak.

To track the stock market you'd have to have weighted holdings in every share.

So when people compare investing in property to shares , how can you compare returns?

Thrugelmir

Dan: wrote: »

Agreed. But it seems many like to discuss and predict the national average on here.

The Nationwide index doesn't even some parts of the Country so can't be refective of the country as a whole.

chucky

mbga9pgf wrote: »

If there is a major bond strike however and we have to cut the deficit to 0%, I agree, there will be massive blood on the streets. But things dont work like that. You wont have absolutely everyone striking; people have varing levels of risk, some will be risk adverse, some will be keen for rediculous levels of risk. It will seriously screw the system and really hurt, but all out collapse will not happen IMO.

it's rumoured that the BOE will start buying corporate and commercial paper soon to avoid this scenario happening