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

Really2

Thrugelmir wrote: »

According to FSA figures. The LTV figure of around 83% reached in 2007/08 was the lowest since 1974. ( 1974 is the earliest figure their records show).

Between 1984 and 2007 the figure never dropped below 90% LTV for first time buyers. So the number of people with sizable deposits is miniscule in relation to the average FTB.

I see what you are saying but to go back to the old "low transaction levels" which keeps getting thrown up.

The ones with the smallest deposits are now frozen out.

There could still be as many "high deposit" buyers (people still die at the same rates and leave inheritance, one of the main causes of high deposits in FTB's) just that their percentage of the market as increased because of the "low deposit" people dropping out.

So the stopping of mortgages 90% LTV and above could have just skewed the figures. Not Just STR's as stated.
The number of people with 40% deposits could still be nearly the same, just that they now make up a larger percentage of transactions.

the_ash_and_the_oak

Really2 wrote: »

I see what you are saying but to go back to the old "low transaction levels" which keeps getting thrown up.

The ones with the smallest deposits are now frozen out.

There could still be as many "high deposit" buyers (people still die at the same rates and leave inheritance, one of the main causes of high deposits in FTB's) just that their percentage of the market as increased because of the "low deposit" people dropping out.

So the stopping of mortgages 90% LTV and above could have just skewed the figures. Not Just STR's as stated.
The number of people with 40% deposits could still be nearly the same, just that they now make up a larger percentage of transactions.

think this is pretty much the case imo

Thrugelmir

Really2 wrote: »

I see what you are saying but to go back to the old "low transaction levels" which keeps getting thrown up.

The ones with the smallest deposits are now frozen out.

There could still be as many "high deposit" buyers (people still die at the same rates and leave inheritance, one of the main causes of high deposits in FTB's) just that their percentage of the market as increased because of the "low deposit" people dropping out.

So the stopping of mortgages 90% LTV and above could have just skewed the figures. Not Just STR's as stated.
The number of people with 40% deposits could still be nearly the same, just that they now make up a larger percentage of transactions.

I would suggest that people receiving an inheritance are more likely to be home owners already. Rather than FTB's, as they are unlikely to be "young". So the money would be used to trade up or BTL rather than be used for first time purchase.

As a side point. Between 2000 and 2008 the amount of money invested in a second home abroad rose from £8 billion to £36 billion. As foreign property no longer was the preserve of the wealthy. Inheritance money perhaps?

Really2

Thrugelmir wrote: »

I would suggest that people receiving an inheritance are more likely to be home owners already. Rather than FTB's, as they are unlikely to be "young". So the money would be used to trade up or BTL rather than be used for first time purchase.

Sorry their are 100,000's of children who lose a parent / parents before the age of 25.

So I disagree there.

lemonjelly

Really2 wrote: »

I see what you are saying but to go back to the old "low transaction levels" which keeps getting thrown up.

The ones with the smallest deposits are now frozen out.

There could still be as many "high deposit" buyers (people still die at the same rates and leave inheritance, one of the main causes of high deposits in FTB's) just that their percentage of the market as increased because of the "low deposit" people dropping out.

So the stopping of mortgages 90% LTV and above could have just skewed the figures. Not Just STR's as stated.
The number of people with 40% deposits could still be nearly the same, just that they now make up a larger percentage of transactions.

I see your point that they "could" be, but is that really the case, with ongoing concerns about job security, rising inflation (minimal i accept) rising fuel prices etc etc.

I wonder if the people you describe are more likely to be STR's, returning to the market, rather than FTB's

chucky

lemonjelly wrote: »

I see your point that they "could" be, but is that really the case, with ongoing concerns about job security, rising inflation (minimal i accept) rising fuel prices etc etc.

I wonder if the people you describe are more likely to be STR's, returning to the market, rather than FTB's

36% of mortgage approvals are now FTB's. that's a historically average number.

the assumption of the large number of STR's returning to buy property are just assumptions or even an excuse to try to justify the current demand for house prices nothing else.

Thrugelmir

Really2 wrote: »

Sorry their are 100,000's of children who lose a parent / parents before the age of 25.

So I disagree there.

There were only 509,090 recorded deaths in total in England and Wales in 2008 !

So I think that you've exaggerated your point slightly.

Really2

lemonjelly wrote: »

I see your point that they "could" be, but is that really the case, with ongoing concerns about job security, rising inflation (minimal i accept) rising fuel prices etc etc.

I wonder if the people you describe are more likely to be STR's, returning to the market, rather than FTB's

I agree in part but again it is a could.

My problem about the STR point is the STR people would have been very bearish on property.
Why would they have flooded back after less than 20% falls.

Also why would some one with an STR fund be more likely to buy than someone who as 40% + deposit from inheritance? They are still at threat from job security and inflation (but inflation is still falling & inflation would possibly be good for assets if it happened)

lostinrates

Thrugelmir wrote: »

There were only 509,090 recorded deaths in total in England and Wales in 2008 !
.

Well, of those who die you leaving children, many have more than one child, and of course, few are likely to buy bfore adult hood, so there is a large possible window for numbers to accumulate.

The other point though is that people dieing younger might have ''less to leave'' and spouses can't be forgotton about.

lemonjelly

Really2 wrote: »

I agree in part but again it is a could.

My problem about the STR point is the STR people would have been very bearish on property.
Why would they have flooded back after less than 20% falls.

Also why would some one with an STR fund be more likely to buy than someone who as 40% + deposit from inheritance? They are still at threat from job security and inflation (but inflation is still falling & inflation would possibly be good for assets if it happened)

Possibly they buy into the arguement of no more falls happening?

Also, savings may not be getting great rates (they're unlikely to want to tie it up)?

I'm not sure if I'm reading it wrong, but other threads indicate inflation isn't falling ?