Take cover! The housing market is heading for a bloody and protracted crash!

Thrugelmir

shortchanged wrote: »

Question is, what will give to get the housing market functioning again?

Time will change the market. The old 3 D's will account for all the current generation of property owners at some point. Whether it be death, divorce or distress. There's no escaping.

Thrugelmir

wotsthat wrote: »

Transport them from the 1930's to the 1950's and they will have wondered what all the fuss was about.

Life was still tough for many. Still rationing in the 50's. Few people owned cars. Also had lost a lot both during the war years and those that followed.

wotsthat

shortchanged wrote: »

You've answered your own question wotsthat. House prices are still overpriced hence the low level of transactions.

Sellers are still stubbornly hanging onto unrealistic prices and buyers still can't (or even sensibly don't want to) get the level of funds to pay the prices they are hoping for. Therefore this reflects the position we now have. A Mexican standoff.

Question is, what will give to get the housing market functioning again?

Oh come on. There are historically low transactions because prices are all of 13% above where bear theory dictates they should be?

What might get the market functioning again is buyers persuading sellers to sell. Maybe offering closer to the asking price?

wotsthat

Thrugelmir wrote: »

Time will change the market. The old 3 D's will account for all the current generation of property owners at some point. Whether it be death, divorce or distress. There's no escaping.

Well the 2D's anyway - those boomers are living for ever:mad::mad:

Graham_Devon

wotsthat wrote: »

What must happen is that the time bought by can kicking is used to take action. In more mundane housing terms we've had 37(?) months of low interest rates - if during that time an indebted householder hasn't taken steps to improve their situation and is being supported by benefits to stay in the house then, of course, there must be a day of reckoning at some point EVEN if the result of this costs the taxpayer more.

And this is the crux of the issue.

The BOE have stated that this does not appear to be happening.

And it reverts back to what I stated earlier. Incomes are not being used to pay down debt in general. Debt is pretty much static only because new debt is not being taken on. Primarily due to resistance, but also due to the lenders making it harder.

The BOE statistics show we have not really paid any debt down. Not in terms of an actual aim to do so. We are just paying down debt through normal repayments. I.e. we are simply servicing debt. Were not paying it down. Not in population terms anyway, of course there are people making overpayments, just as there are people going bankrupt.

The reason were not paying it down is simple. Other prices are going up. We know this through the inflation vs wage inflation figures.

shortchanged_2

wotsthat wrote: »

What might get the market functioning again is buyers persuading sellers to sell. Maybe offering closer to the asking price?

:rotfl: And pay with what?? Chocolate coins? Several bags of spuds into the deal?

Thrugelmir

Graham_Devon wrote: »

The BOE statistics show we have not really paid any debt down. Not in terms of an actual aim to do so. We are just paying down debt through normal repayments. I.e. we are simply servicing debt. Were not paying it down. Not in population terms anyway, of course there are people making overpayments, just as there are people going bankrupt.

Think of the UK as having a large repayment mortgage. That started in 2007 over 25 years.

After 5 years we've only repaid 11% of the capital borrowed. After 15 years 45%. After 20 years we'll still owe 30% of the original debt borrowed.

There are no quick fixes.

If you take the view that total mortgage borrowing should reduce to around the £700 billion mark. The pre credit boom level adjusted for inflation. Its would take 16 years to get to that level and that's if no further advances are made. So a very long road ahead in terms of debt reduction.

FTBFun

Well, at least they're being consistent:

Nov 2011

http://www.dailymail.co.uk/news/article-2066088/House-prices-rise-25-000-just-years-homes-shortage-takes-hold.html

May 2011

http://www.dailymail.co.uk/news/article-1383668/House-prices-fall-years-longest-property-slump-lifetime.html

May 2010

http://www.dailymail.co.uk/news/article-1270938/House-prices-predicted-increase-5-cent-year.html

March 2009

http://www.dailymail.co.uk/news/article-1161317/House-prices-drop-55-leave-Britain-bankrupt.html

Graham_Devon

FTBFun wrote: »

Well, at least they're being consistent:

Nov 2011

http://www.dailymail.co.uk/news/article-2066088/House-prices-rise-25-000-just-years-homes-shortage-takes-hold.html

May 2011

http://www.dailymail.co.uk/news/article-1383668/House-prices-fall-years-longest-property-slump-lifetime.html

May 2010

http://www.dailymail.co.uk/news/article-1270938/House-prices-predicted-increase-5-cent-year.html

March 2009

http://www.dailymail.co.uk/news/article-1161317/House-prices-drop-55-leave-Britain-bankrupt.html

You could do this with any news outlet, as they report news.

Be that the guardian, telegraph, FT, Mail, Sun, Mirror.

Probably the only one you couldn't suggest reported one thing and then the opposite view is the Express.

FTBFun

Graham_Devon wrote: »

You could do this with any news outlet, as they report news.

Be that the guardian, telegraph, FT, Mail, Sun, Mirror.

Probably the only one you couldn't suggest reported one thing and then the opposite view is the Express.

I accept your challenge:

Nov 11

http://www.express.co.uk/posts/view/285847/House-prices-to-soar-by-15%25/

Jan 11

http://www.express.co.uk/posts/view/225556/House-prices-fall-for-seventh-month

BTW this is quite interesting:

http://fullfact.org/factchecks/differing_claims_on_house_prices-3009