Homeowners are in for a drop in prices in next year’s first half

Graham_Devon

Dan: wrote: »

Not even Hamish thinks its gonna be nothing but rises from now on. I would say pretty much everyone on his board has preidcted further months of falls.

I put the quote in because I wanted to highlight specifically that bit.

If a small number of cash rich buyers have supported prices, and we are going into second falls...

What is going to support prices in the next leg down and stop them falling?

It can't be lending, it can't be cash rich buyers...so what?

Lotus-eater

Graham_Devon wrote: »

Same story, slightly different angle here:

http://news.bbc.co.uk/1/hi/business/8253017.stm

"a small number of cash-rich buyers have supported prices"

This is exactly what I think and seems to be supported by the local stuff I see. I see no, one kind of house selling more than others, only ones that are fairly priced are selling, cheap or expensive.
It's the buyers that seem similar, they have large deposits and most of the time, are comfortably off (in their level of living).

System

House prices will not return to the peak reached in autumn 2007 for at least another five years, - Hetal Mehta, Item’s senior economic adviser, said. In a special report released today, Item predicts that homeowners are in for a drop in prices in next year’s first half and then two years of stagnation

Today marks the day that bears and bulls started predicting the same things.

chucknorris

brit1234 wrote: »

House prices ‘will take five years to return to peak’

Yahoo! great news (or opinion I should say)! have you turned Bull now Brit?

So in just 5 years time we not only get back to 2007 price levels. Personally I think this might be a bit optimistic, I think you are being a bit too bullish.

Heyman_2

Dan: wrote: »

Not even Hamish thinks its gonna be nothing but rises from now on. I would say pretty much everyone on his board has preidcted further months of falls.

Yeah, it won't stop the hysteria when we eventually see the first MoM fall though will it :rolleyes:

Heyman_2

Graham_Devon wrote: »

What is going to support prices in the next leg down and stop them falling?

It can't be lending, it can't be cash rich buyers...so what?

Lack of supply due to a combination of NE and low SVR rates?

chucky

lemonjelly wrote: »

Not convinced by the bit I've highlighted Chucky. My reasoning is that the impact of the levels of personal debt have yet to have the impact which reality will see. I also feel that even if we are merely having a correction, to be through it within 6 months or so, when the foundations of the credit crunch took 10-12 years to build, it all seems to have a lack of proprotion to it all.

Low interest rates appear to be here to stay. With some offers about, it could be argued savers are making more on interest recieved - a reason not to jump in? Perhaps a reason to hold on for a bargain?

Forced sales have also been suppressed, with government pressure seeking to reduce the lenders taking swift action too.

we sort of agree on this point, defaults will increase but be diluted due to the rates being low for an extended period of time - low interest rates are here to stay for those that have a good credit history but with higher defaults on loans, banks will increase their rates to include these losses. the margins they use to lend will increase as coverage for bad debt. that's a factor that will impact rates.

Cleaver

nembot wrote: »

you can pretty much guarantee prices will be nearer to 20% cheaper than today in 2 years time, no matter how the big cheeses spin it...

In these uncertain times I simply don't understand how anyone can be so sure of themselves.

chucky

Graham_Devon wrote: »

I put the quote in because I wanted to highlight specifically that bit.

If a small number of cash rich buyers have supported prices, and we are going into second falls...

What is going to support prices in the next leg down and stop them falling?

It can't be lending, it can't be cash rich buyers...so what?

i wouldn't have thought that this is what is supporting prices. if it was the case mortgage approvals would not have been increasing month on month consistently.

you could argue lower than average LTV buyers but not cash buyers.

Graham_Devon

chucky wrote: »

i wouldn't have thought that this is what is supporting prices. if it was the case mortgage approvals would not have been increasing month on month consistently.

you could argue lower than average LTV buyers but not cash buyers.

Well they have to be cash rich to get the mortgages.

You need that deposit, and deposits at the moment are not exactly small change.