It doesn't matter what the government does - UK house prices will fall

Flight2quality

It doesn't matter what the government does - UK house prices will fall

http://www.moneyweek.com/investments/property/uk/first-time-buyer-scheme-uk-house-prices-14700

The government's latest plan to prop up the UK property market has been criticised by almost everyone.

And rightly so. Encouraging lenders to give first-time buyers 95% home loans is downright immoral in the current climate. There's a reason that lenders require big deposits and are reluctant to give people money just now – it's because they think house prices are more likely to fall than to rise.


If the coalition really wants to help, they'd let prices fall. Of course, that's not a vote-winner, so there's no chance they'd endorse that policy.

But whether they like it or not, that's what's likely to happen…

andybenw

Prices are falling in real terms. However 'real terms' matters not a whit when wages are not increasing and savings rates are tiny.

Stagnation is the way ahead for the next couple of years. The government have as much as admitted that this is what they wish and the BOE interest rate policy and other measures will continue to 'make it so'.

Both bulls and bears will be disappointed over the next couple of years I feel. It will be more of the same.

andybenw

And to add.

As people begin to accept that the crash will never happen then BTL will rise again in conjunction with FTB, limiting supply and putting pressure on prices to move upwards. With everyone having a rather pessimistic outlook at present this will take time, and prices may rise at a lower level than general inflation but they will eventually rise.

Mallotum_X

Agree with more of the same. Yes property may well fall but we are looking at couple of percent on average annually at most (regional variations of course).

Any crash now will be due to something happening outside of the UK. The Euro crisis is most likely if something were to cause a crash, but even that I would imagine will limp though the problems.

Thrugelmir

Flight2quality wrote: »

The government's latest plan to prop up the UK property market has been criticised by almost everyone.

Without a single constructive response. Better to get on and be productive in some form. However small it maybe. Than moan and criticise.

joguest

So, taxes have risen, unemployment's rising, mortgage rates are going up and real incomes are down 3.5% in the last year according to the ONS. I can't imagine what effect all this will have on house prices.

abaxas

joguest wrote: »

So, taxes have risen, unemployment's rising, mortgage rates are going up and real incomes are down 3.5% in the last year according to the ONS. I can't imagine what effect all this will have on house prices.

I'd say, up up up.

Buy now before you miss the boat *


* the views expressed above may not me those of a mentally well individual.

Get-real-buy-real

andybenw wrote: »

Prices are falling in real terms. However 'real terms' matters not a whit when wages are not increasing and savings rates are tiny.

Stagnation is the way ahead for the next couple of years. The government have as much as admitted that this is what they wish and the BOE interest rate policy and other measures will continue to 'make it so'.

Both bulls and bears will be disappointed over the next couple of years I feel. It will be more of the same.

The definition of bulls are they think prices will go up. If anyone is a bull they will be disapointed.

How could bears possibly be disappointed from here, no one in their right mind thinks prices will not fall from here, the only question is how much and for how long?

Flight2quality

abaxas wrote: »

I'd say, up up up.

Buy now before you miss the boat *


* the views expressed above may not me those of a mentally well individual.

The funny thing is there are still bulls left on this very forum, are you calling them mentally unwell?

abaxas

Flight2quality wrote: »

The funny thing is there are still bulls left on this very forum, are you calling them mentally unwell?

A permanent state of optimism is just as bad as one of depression.

They are both mental illnesses.

andybenw

Get-real-buy-real wrote: »

The definition of bulls are they think prices will go up. If anyone is a bull they will be disapointed.

How could bears possibly be disappointed from here, no one in their right mind thinks prices will not fall from here, the only question is how much and for how long?

It seems i'll have to spell it out.

Bulls want price rises. Bears want price falls.

There will be stagnation.

Stagnation means no movement. ie no rises or falls.

Hence both bulls and bears will be dissappointed.

Thicky.