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Debate House Prices
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Crashers get ready with those big deposits!
Comments
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I agree with 5% down from June peak by xmas - and I'm not sure Hamish would disagree.
Then I can see supply being withdrawn if at all possible and more low volumes and declining prices for those who do have to sell.
I am not sure if it will be 2 years of gentle falls or 12-18 months fairly steep like last time and I suspect it will go below the feb 09 trough but it will also recover again and house prices over each cycle will rise faster than incomes.
Therefore Hamish is right - in the long term it is better to be leveraged in to the market than not in it.
However the bears are also right, buying at the right point in the cycle can have a huge impact on an individuals finances even when measured over their whole life.
Declining prices for those who do have to sell. Just so you know, it's not in isolation. Your declining prices for those who do have to sell causes declining values for those who own who are not selling.
carolt seems to think your area is beginning to see signs of rapid hits in value. In terms of over just a few weeks. I believe some areas can see rapid falls in value. Hit over a few weeks. Another sharp hit over a few weeks a few months later. Depends upon what sellers are accepting from buyers isn't it.
The recovery is "lower prices" imo. Leverage yourself silly in this market, "for the long term" and in these economic conditions we're up against? No thanks. Property doesn't always go up in value over the long term. Crash and 50 years of stagnant values is as much a possibility for me.Totally out-of-date. Recent prices in St Albans crashing down. A year ago, you'd have been hard pushed to find anything there for less than 300K. Now, you'd find loads of 3 bed family houses in the 250-275 mark. I signed up to something years ago when we contemplated moving there, and I'm getting loads of cheap houses in my inbox every day now.
No idea why, really, other than the fact it didn't come down as much as other surrounding areas in 2007 - maybe it's just a late reaction? Don't know - do know that most recent figures will show prices there falling a lot within the last few weeks.0 -
Guess it is just "lucky" for us buyers-waiting-for-good-value that there a lot more property has come on to the market during 2010 than in 2009. And more continues to come to market.
And more still came to the market in 2007 than did in 2010.
Yet prices have recovered back to peak in many areas, and are not far from it in most areas.
When, according to your theory, they should have been falling off a cliff all the way through. Wonder why.....more sellers will have to lower their asking prices, more intune with what the market can afford in order to find a buyer and to sell.
Oh yes, that's why.
Because it didn't quite work out that way last time around, did it?
What actually happened is that as prices dropped people just took their homes off the market. Supply reduced, and prices rose again.
In the absence of mass forced sales, you simply won't get the level of prices drops the crashaholics clearly need to buy. And with mortgage arrears at extremely low levels, base rates not going anywhere near 2007 levels for perhaps a decade, and unemployment projected to fall by 2 million people over the next 5 years, that level of forced selling looks to be an increasingly unlikely pipe dream for the bears.Meanwhile, Sibbey's hopes depend upon the banks suddenly deciding to flood people with easy debt again + the willingness of a more cautious society which has now come to realise it's not forever crazy boom and never a bust.
People who may be a lot more concerned about their own employment/pay prospects, even if they do qualify to lender's tighter criteria to borrow sufficient money for a mortgage.
Sibbers may believe that, you may believe that..... But I don't.
Population continues to grow, household formation continues to grow, housebuilding continues to decline.
The inevitable consequence of this is more people (and thus more earners) living in each house on average. Meaning average household income will increase, providing the mechanism for higher rents and house prices.
Absent a massive housebuiilding programme, which with the NIMBY Charter of this government is now impossible, there is no possible direction for house prices over the medium to long term other than up. And not just up a little, up a lot.
The seeds of the next boom are being sown today. And there's not a thing anyone can do about it other than to radically increase supply.
If housebuilding triples, I'll turn bear.
Until then, I'm 100% certain that any price declines will be relatively minor and quite temporary in nature...... The scale of crash the bears hope for is impossible to achieve in the face of such a shortage. Which is why the bears were caught out last time, and will likely be caught out if prices dip again.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
But that probably means that people who don't have to sell won't and a lot of the properties on the market won't sell.
Yes; I'll accept there are some complicated variables involved. I'll accept there are a lot of sellers who don't have to sell, and who are nearly "immovable" from lowering their asking price.... thinking "this is what it's worth."
Then there is competition against buyers for the sellers who are prepared to lower asking prices to within reach or towards what looks like value to some. Acting somewhat as a market support for values.
It's complicated - but the main variables suggest a long period of falling values to me. Perhaps not as rapid as I'd like in some areas, due to fewer "need to sell" but we'll see. Other variables including lots of ageing baby-boomers who have stacks of equity and seen values x20+ who can easily take a considerable hit to from peak values in order to sell / downsize with a lot of money left over.0 -
carolt seems to think your area is beginning to see signs of rapid hits in value. .
To be fair, carolt has made similar claims every month through the recovery, when prices were soaring.
Even a stopped clock is right twice a day, I suppose, but I'd take carolt's claims with more than a pinch of salt.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
Other variables including lots of ageing baby-boomers who have stacks of equity and seen values x20+ who can easily take a considerable hit to from peak values in order to sell / downsize with a lot of money left over.
Except they can't really, because any gains in house prices only just compensate them for the value of their pensions being destroyed.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »Except they can't really, because any gains in house prices only just compensate them for the value of their pensions being destroyed.
Many baby-boomers have real, decent pensions. They aren't reliant on the value of their homes alone.0 -
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Many baby-boomers have real, decent pensions. They aren't reliant on the value of their homes alone.
Not quite.....
Most baby boomers started their career with the expectation of real, decent, pensions. That's entirely different to what eventually happened.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »Until then, I'm 100% certain that any price declines will be relatively minor
Is this like you were 100% certain that gold and silver were going to crash? Since you said that precious metals have outperformed almost every other asset class.0 -
Yes; I'll accept there are some complicated variables involved. I'll accept there are a lot of sellers who don't have to sell, and who are nearly "immovable" from lowering their asking price.... thinking "this is what it's worth."
Then there is competition against buyers for the sellers who are prepared to lower asking prices to within reach or towards what looks like value to some. Acting somewhat as a market support for values.
It's complicated - but the main variables suggest a long period of falling values to me. Perhaps not as rapid as I'd like in some areas, due to fewer "need to sell" but we'll see. Other variables including lots of ageing baby-boomers who have stacks of equity and seen values x20+ who can easily take a considerable hit to from peak values in order to sell / downsize with a lot of money left over.
I am one of those baby boomers but the lower prices fall and with the cost of moving the less point I can see in selling, after all I can afford to stay where I am.
For what it’s worth I think house prices will fall not by the 25% some people think but then I thought they would fall in 2009.0
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