Friday Debate: Will House Prices ever be allowed to fall?

IveSeenTheLight

ILW wrote: »

What do you mean by a little extra time, weeks, months or years?
And do you not consider it the buyers responsibility to insure against loss of income?

There are many options you can explore if you face mortgage payment trouble.
You could move on to interest only, reset the amortization period, agree a payment holiday etc etc.
Obviously the more equity you have, the more leeway you are likely to get.

If you need reposessions to keep reigns on the property market then your unlikely to be in a good position to buy.

I can foresee less of thepopulation as a percentage being owner occupiers in the future, whilst I would prefer the opportunity was extended to more.

I do also understand that some people will never be able to afford to buy.

If you have diligently paid your mortgage for say 5 years, there should be sufficient equity and leeway to allowa couple of years to re-establish yourself in the job market / adjust your financial position without affecting the banks risk.

Of course, if you promote lower house prices and people getting into negative equity, then you are wishing missfortune on others in order to benefit for yourself and increasing the risk to the banks and many more people.

This is why the government do not wish falling prices in order to reduce the risk to the banks, the economy and to the majority of the population

chucky

des_cartes wrote: »

Have you asked yourself why house prices are falling now but were not before May?

have you asked yourself how much house prices have changed since Jan this year.

forget the asking... they're + or - 2% higher or lower.

i wouldn't call the falling house prices.... i'd call it stagnation...

myhouse_2

RenovationMan wrote: »

Given that so much of the UK's economy is rooted in property, probably more than at any other time in history and given that so many voters are now home owners, will any government ever allow prices to fall in a significant way?

If market forces prevents us from having ever increasing house prices and the government put measures in place to support existing prices, will we ever see anything other than stagnation?

If we have stagnation over the next 5 to 10 years while wages catch up with house prices, is there any value in waiting to buy once a reasonable deposit has been saved up?

Governments have priorities, and these change over time.
Though keeping house prices high were not necessarily the main target, many recent govt (and BoE) policies have had that effect (IR, mortgage support, QE).
Though these policies will likely continue for several more months, this time next year you can expect policies to be already working against high house prices (higher IR, repaying QE, cuts to mortgage support).

ukcarper

ILW wrote: »

If people are living in houses they cannot afford, yes they should be kicked out. The true market should be allowed to function in both directions.

ILW wrote: »

Nothing to do with wanting to buy cheap houses, just cannot see why anyone should have ownership of any asset which they have not and cannot afford to pay for.

Wouldn’t they bed made homeless put in rented accommodation and the landlord’s mortgage be paid by LHA