How long before the inevitable nominal fall of 35% in houseprices

homelessskilledworker

1. Unemployment over 2.500,000 and only going to get worse

2. Credit crunch according to most economic experts is going to get worse in 2012

3. The Euro on a knife edge

4. Growth unlikey to return to anything like worthwhile for a decade

5. Record levels of debt, personal and government

6. Austerity cuts

7. House stock pile can only get bigger, people are still dying and divorcing.

So the inevitable nominal fall in property prices of 30% plus simply will happen, but how long?

I say by 2013


P.s. Property bull trolls, I will not be taking any notice in what you are saying:)

Pimperne1

homelessskilledworker wrote: »

1. Unemployment over 2.500,000 and only going to get worse

2. Credit crunch according to most economic experts is going to get worse in 20120

3. The Euro on a knife edge

4. Growth unlikey to return to anything like worthwhile for a decade

5. Record levels of debt, personal and government

6. Austerity cuts

7. House stock pile can only get bigger, people are still dying and divorcing.

So the inevitable nominal fall in property prices of 30% plus simply will happen, but how long?

I say by 2013


P.s. Property bull trolls, I will not be taking any notice in what you are saying:)

Shortage of housing. Low mortgage repayments. Sellers strike.

Linton

If all the bad things happen why wont FTBers be affected equally?

Prices will only fall by 35% if the amount that people can afford to pay drops by 35% and so about the same number of people who cant afford to buy a house now wont be able to afford one then.

Incidentally, on your list divorces and family break-up increases house prices - one household turns into two.

paulmapp8306

1. Nope. There is only a shortage of housing at the "social housing" level - not for buyers.

2. Low Mortgage payments wont last. The base rate is going to HAVE to raise by a point or two in the next couple of years due to inflation alone.

3. Sellers strike?? some yes - but some are forced. Repos when the rates go up, deaths, diveroce/splits, debt, job losses. Overall the housing supply should remain stable even if people who CAN move (rather than being forced to) decide to stay put.


Im not sure 30% is realistic as we've already had a drop - bur going on historical "graphical" representations of house price boom and busts - along with recession figures would indicate another 15-10%, maybe as much as 25% over the next 2-3 years.

Im hoping 2013 only as that5s when Im looking at buying and will have a decent deposit even on todays prices (50% ish). If there is a 25% fall over the next 18 months I could even buy cash

paulmapp8306

Linton wrote: »

Incidentally, on your list divorces and family break-up increases house prices - one household turns into two.

Indeed - however it turns from one that CAN afford to own their own home to two who CANT.

paulmapp8306

Linton wrote: »

If all the bad things happen why wont FTBers be affected equally?

Yeh - which is possibly the key Factor. People already on the housing ladder arnt actually affected that much. Sure you house goes down in price 30% but so does the house you want to move to.

BUT for the whole chain to move - prices need to be low enough for FTBs to come in at the bottom. With mortgages harder to get - larger deposits - higher rates a certainty (at some point), lower overall wages, and fewer jobs - the amount of FTBs will continue to fall. House prices must follow until they get to a level where those priced out by these factors at current levels can afford to get on that ladder.

Linton

paulmapp8306 wrote: »

Indeed - however it turns from one that CAN afford to own their own home to two who CANT.

So they rent which helps increase rental rates which brings in more BTLs which..... Everyone must live somewhere, and the higher the number of households the higher the pressure to raise housing costs of whatever form.

paulmapp8306

Dont agree. If prices keep raising, and private rents keep raising fewer people can afford to private rent. They turn to social housing, which is already stretched. The government has to start subsidising (more than now) private rents which it cant afford to do. Ultimately the whole thing becomes unsustainable. The government EITHER caps what private landlords can charge, thus fewer people want to become landlords OR the government funds lots of very cheap housing which it puts its social tenants into - there is suddenly a high surplus of private housing. In both cases the value of private homes must reduce to get to status-quo.

Unfortunately house prices have been unsustainable long term since the mid 80s boom, though it did return to something like the correct levels in the early 90s before taking off again.

The only possible way prices can rise again - or even stay stable - is for the world economy to get back on its feet - jobs becoming available - wages to increase and money being much les tight. Can you really see that happening anytime in the next 5-10 years ???

Cleaver

paulmapp8306 wrote: »

The only possible way prices can rise again - or even stay stable - is for the world economy to get back on its feet - jobs becoming available - wages to increase and money being much les tight.

I know what you mean, but that isn't the only way house prices can rise. Obviously very extreme, but what would happen if 25% of house fell down tonight? Or if the goverment announced tomorrow that 100% mortgages at 3% fixed for 25 years are available for all? Or suddenly 4 million rich Chinese moved to England next week? All these are obviously stupid examples and unlikely to happen, but I'm just demonstrating that factors other than just the economy effect house prices.

I happen to agree with you though, I think we'll see little growth in the economy for years and years, although I also don't think things will get any worse. I therefore see hosue prices being a bit like the economy - bumbling along not moving anywhere in either direction.

Arthurian

Pimperne1 wrote: »

Shortage of housing. Low mortgage repayments. Sellers strike.

I agree. It seems to me there is more of a sellers strike and shortage of good housing than meets the eye. There's plenty of houses for sale with riverside views (hoping people will forget the flooding of the past few winters) or with wind farms/high speed rail/massive development planned nearby, etc. Not many for sale without problems, which previously would have been put up for sale on a whim.

tleefox

homelessskilledworker wrote: »

So the inevitable nominal fall in property prices of 30% plus simply will happen, but how long?

I say by 2013


P.s. Property bull trolls, I will not be taking any notice in what you are saying:)

I am neither a bull or whatever the opposite of a bull is.

It simply will not happen, and I'm afraid that if you are one of the seemingly high number of people on here who are clinging on to the never-ending hope that they will fall by a high percentage, you are going to be disappointed.