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

paulmapp8306

Depends on your standards. with the exception to the riverside ones - i dont see a problem with any of the others.

There was always been at least 2 tiers of housing. The top tier - nice houses, nice areas, nice views, good schools, local amenities etc etc. Then the bottom tier, houses that are in towns and cities - most of which are compromises on ideals, and some with maybe mosr negatives than positives - however these offer the chance to own rather than rent - and in most cases are cheaper than renting. These are actually the ones that are also most likely to be reposessions and the like as well as its those with lower incomes that bought them - and ho are now feeling the pressure.

Those who own (or aspire to) the top tier are not affected quits so much - generally having betteer jobs, more security etc - and most (not all obviously) are already on the housing ladder at one level or another.

i feel its the lower tier that need to - and is likly to fall in value further The top tier will probably stay static until things improve elsewhere.

paulmapp8306

tleefox wrote: »

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.

Reasons?

I agree in general it will remain static. I can see more reasons for prices to fall than rise - but not by 30%. There may be areas where small rises do happen, and others where there will be small falls - but in general I think things will be static, but it wont take much inthe way of further resession, more job losses, further economic issues in Europe etc top push the whole market lower.

StevieJ

Cleaver wrote: »

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.

I am wary about projecting the scenario we have today a long time into the future, it is natural to do so but very often way off the mark.

homelessskilledworker

tleefox wrote: »

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.

No, I am really not..

But here is a fact... THERE IS NO MONEY LEFT

At least to buy property at the levels they are now, people can claim that they are able to hold out forever, but that is simply impossible, over 500,000 die each year in the UK, thats a lot of houses.

Pimperne1

homelessskilledworker wrote: »

No, I am really not..

But here is a fact... THERE IS NO MONEY LEFT

At least to buy property at the levels they are now, people can claim that they are able to hold out forever, but that is simply impossible, over 500,000 die each year in the UK, thats a lot of houses.

:rotfl::rotfl::rotfl:

Sorry, only wanted one laugh smiley but message was too short.

homelessskilledworker

Pimperne1 wrote: »

:rotfl::rotfl::rotfl:

Sorry, only wanted one laugh smiley but message was too short.

Share your wisdom with us, who is lending all this money then?

BigAunty

I think there would only be a massive fall in house prices if there was an event that caused lots of property owners to put their properties on the market.

It would have to be something fairly catastrophic, like a major financial crash much worse than the recent crisis or a huge spike in interest rates.

Despite the higher rates of unemployment, there are schemes in place to prevent repossession of residential properties. I'm not saying that owner occupiers don't lose their properties but there are certain schemes there that head some off.

"House stock pile can only get bigger, people are still dying and divorcing." People are living longer and relationship breakdowns, immigration and the trend for smaller size households (i.e. lone parents, single occupiers), not matched by house building, means that the population is rapidly increasing and so too are the number of households. This sustains house prices. A divorce means that a family's accommodation requirements are doubled!

"Record levels of debt, personal and government." How does this lead to a 35% fall in house prices? MSE has a Debt Free forum where people pick up tips on how to walk away from thousands of pounds worth of consumer debts with next to no repercussions for them?

paulmapp8306

The simple fact is, people dont have the money to afford homes at the current level.

Energy prices rising, food costs rising, real term wage levels falling, job security etc etc etc. It is true that there is an ever growing number of hoseholds - and yes everyone has to live somewhere BUT, the problem is MOST of these households cant get or afford mortgages for homes at the current level. That means prices of homes on the market has to fall until they can afford them.

The normal argument there is that in this case those homes will be snapped up by investors etc to let. This will happen a little - but the same people that cannot afford to buy, cant afford to private rent either without government help. If prices increase then the landlords need to increase rent to break even let alone make a profit, and this is also true if prices remain static but interest rates go up. Few people are actually taking this route.

The problem is - as I said earlier - that there is a lack of low cost and social housing. This means the government needs to subsidise the higher rent because there the only homes people can get. This initially lends weight to those saying the BTL market will sustain house prices. Unfortunately this is also only short term. The Government cant afford to subsidise at current levels let alone with more people needing help and higher rents. The only solution here is either compulsory purchase orders - which will not happen - OR they build - fast - and lots. Quite possibly low cost prefabs - or flatpack homes. These will become affordable social housing which will leave the landlords without a lot of tenants, and private rental prices will have to fall. This leads to landlords trying to sell off homes that are no longer making profits, and a glut of homes on the market - and lower house prices.

While this is conjecture - the growth of the population, the requirement for LOW COST housing (be that buying or renting) and the fact the government doesnt have the money to subsidise those who have to privately rent on low wages means the "mass build" is inevitable at some point, and Im guessing fairly quickly (starting in the next 3-5 years).

I guess the bottom line is - YES everyone has to live somewhere - BUT they need to be able to support the rent/mortgage, meaning the cost must be a reasonably % of income after essential bills. With those essential bills rising and income frozen or dropping its a no brainer what HAS to happen to accommodation costs - both house prices and rental costs.

paulmapp8306

BigAunty wrote: »

"Record levels of debt, personal and government." How does this lead to a 35% fall in house prices? MSE has a Debt Free forum where people pick up tips on how to walk away from thousands of pounds worth of consumer debts with next to no repercussions for them?

Because for the majority they cant just walk away - trust me, with £44k debt 10 years ago I know about debt.

They "could" fall simply because people (especially coming into the bottom of the ladder) simply cant afford to get on the ladder, with current wage levels, energy prices, food costs, transport costs, deposit requirements etc.

Ultimately that means prices must drop to a level where the amount of homes on the market is equivalent to the amount of people that CAN afford to buy. Currently were at that kind of level, but with no sign of the economy improving, more cuts and a bigger squeeze on wages, more hikes in energy etc thats going to change - and not for the better (if you want prices to raise).

Im not saying there gong to crash - probably not, but I do feel there going to be static, then a small droop, then static, then a further small droop. This will continue until the economy is back on its feet, and wages v outgoings increase again.

Pimperne1

homelessskilledworker wrote: »

Share your wisdom with us, who is lending all this money then?

Sorry when you said "over 500,000 die each year in the UK, thats a lot of houses" I wondered whether you had considered that more people come to live in the UK each year than leave.