UK house prices face prolonged bear market

carolt

No-one can really argue with the basic point of the article - that house prices relative to incomes in this country are going to get cheaper - because the only way is down, without a return to lax credit that we all know could only end in tears.

So there's something to cheer about over your cornflakes.

HAMISH_MCTAVISH

carolt wrote: »

No-one can really argue with the basic point of the article - that house prices relative to incomes in this country are going to get cheaper - because the only way is down, without a return to lax credit that we all know could only end in tears.

Of course you can argue the point. We've seen tougher lending over the last year than we have in several decades, and prices have risen by 10% or so anyway.

Once competition returns to the market, lending will increase, and prices will too.

So there's something to cheer about over your cornflakes.

It certainly is.

Doctor_Gloom

Why do certain people (see above) continue to peddle the myth that house prices have risen. The pound has collapsed in value so your property is worth much less than it was, which is why people come from overseas and eagerly snap up property at knockdown prices. The government has certainly fooled quite a few gullible people into believing their property hasn't fallen in value when in reality it most certainly has. Wake up, open your eyes, the government has taken you for a mug.

carolt

HAMISH_MCTAVISH wrote: »

Once competition returns to the market, lending will increase, and prices will too.

Lending may well increase; there's not much room for it to decrease without grinding to a halt altogether.

But that doesn't mean prices will increase, unless credit is loosened again - do you really see a return to the kind of ridiculous lending practices of the last few years? 125% mortgages, anyone?

I wonder what happened to the particular bank that specialised in those by the way... :think:

Hmmm, Hamish - can you remind me?...

(Where's a roll-eyes smiley when you need one? )

Cleaver

carolt wrote: »

Lending may well increase; there's not much room for it to decrease without grinding to a halt altogether.

But that doesn't mean prices will increase, unless credit is loosened again - do you really see a return to the kind of ridiculous lending practices of the last few years? 125% mortgages, anyone?

I don't think we'll see 125% mortgages again, no.

However, I think there is probably a market out there for far more 90% and 95% mortgages which first time buyers would traditionally go for. I think we'll see a lot more of them at better rates over the next year or two.

System

Doctor_Gloom wrote: »

Why do certain people (see above) continue to peddle the myth that house prices have risen. The pound has collapsed in value so your property is worth much less than it was, which is why people come from overseas and eagerly snap up property at knockdown prices.

Until the population here gets paid in foreign currency it's a non-sensical argument.

But you knew that already.

IveSeenTheLight

MiserlyMartin wrote: »

I could buy a house tomorrow - CASH. But I won't at these prices. They are overvalued and will correct eventually when the props are removed.

Time will tell if your decision proves to be a financially savvy one or not.
For you I hope it does, however it is quite a substantial risk / gambol.

Is your capitol interest covering the rent you must be paying?
If not, is it not costing you each month you have to rent?
If it is, it eases the burden, but the question then is have the property types that you are looking at in your local area increasing or decreasing.
On average in the last year house prices have been increasing, probably at a rate higher than what you are receiving in interest once rents etc are deducted.

Doctor_Gloom

Joeskeppi wrote: »

Until the population here gets paid in foreign currency it's a non-sensical argument.

But you knew that already.

Some people can see the bigger picture. If you're content to be fooled by the government and believe that you're no worse off despite your income and assets being in an increasing worthless devalued quantitatively-eased monopoly money currency then good for you. Others aren't so easily fooled.

JonnyBravo

Joeskeppi wrote: »

Until the population here gets paid in foreign currency it's a non-sensical argument.

But you knew that already.

It's not a non-sensical argument.
It's fine and doesn't affect you so long as you only want to buy anything in sterling that has no exposure to foreign currency. The moment you buy anything that's in part exposed to foreign currency you are poorer. You might not feel it as the effects are small at the moment but it's there none the less.

An unusally astute post from Doctor Gloom. Very unusual.

IveSeenTheLight

Doctor_Gloom wrote: »

Some people can see the bigger picture. If you're content to be fooled by the government and believe that you're no worse off despite your income and assets being in an increasing worthless devalued quantitatively-eased monopoly money currency then good for you. Others aren't so easily fooled.

I think Joeskeppi's point is that generally, people purchase UK property with pounds sterling.

On saying that, the reports of the exiles brits wishing to return home should arguably not get a better time to do so.