House price crash news

nollag2006

wibble68 wrote: »

Are you saying that if interest rates move higher (8 - 10%), that house prices will still increase due to supply and demand?

8 - 10% ????

Where did you get that from ?

I don’t know of any economist or financier who is predicting such a rate rise. I doubt you do either.

Any chance I could have some of whatever it is that you're smoking ??

:rotfl:

PJD

mystic_trev wrote: »

You obviously weren't around during the last crash, same scenario, the great housing shortage of the late 80's with prices going through the roof. The market went from plenty of demand and a shortage of supply to no demand and falling prices in a matter of months.

But the main reason for the crash in the 80s was the huge IR rise over such a short period, then IR were kept high there-after for quite a while

nollag2006 wrote: »

And what IS she wearing on the last page??

Personally I think she looks alright

wibble68_2

nollag2006 wrote: »

8 - 10% ????

Where did you get that from ?

I don’t know of any economist or financier who is predicting such a rate rise. I doubt you do either.

Any chance I could have some of whatever it is that you're smoking ??

:rotfl:

I'm not say rates will move that high in the short term.

My point is supply and demand is not the number 1 driver of the housing market. Interest rates / affordability are the main factor.

mystic_trev

nollag2006 wrote: »

8 - 10% ????

Where did you get that from ?

I don’t know of any economist or financier who is predicting such a rate rise. I doubt you do either.

Any chance I could have some of whatever it is that you're smoking ??

:rotfl:

Higher Interest rates are here to stay, latest BoE Inflation report today, page 41

http://www.bankofengland.co.uk/publications/inflationreport/ir07may.pdf

epz_2

PJD wrote: »

But the main reason for the crash in the 80s was the huge IR rise over such a short period, then IR were kept high there-after for quite a while

kind of like rates going up from 3.5% to 5.5% in 3 and a bit years with further rises predicted and plenty of people on fixed rates comming to the end of their fix period.

the real issue is with a 3rd of mortgages now interest only a a lot of very highly geared BTL's there isnt as much slack in the system. last crash lots of people extended their terms or went interest only, a 3rd of owners now dont have this issue while BTL have multiple properties all with costs going up often more than can possibly earn with static rents.

[Deleted User]

8%+ seems fairly realistic too me to bring inflation back in line so i dont know why your laughing nollag2006, this country has seen 15% plus rates before many a time.

Pobby

What amazes me is just how high prices are.This,imho,is driving a wedge through society.On one hand we have those that bought when prices were cheaper and can afford to keep things going in a comfortable way.On the other hand,we have people paying a lot of money to private landlords.

At least social housing is affordable as the rents seem to be pitched at a fair bit lower than the private sector.

My guess is that muppet b-t-l wallers are still jumping in and quite likely are getting negative returns but singing the``house prices can only go up mantra``.This aspect is distorting the market.So would be owner/occupiers are having to take the risk that it won`t go Pete Tong when the rates keep rising.

[Deleted User]

Yep lots of muppets pobby in this country that dont understand that things can and do change.

pinkshoes

mystic_trev wrote: »

You obviously weren't around during the last crash, same scenario, the great housing shortage of the late 80's with prices going through the roof. The market went from plenty of demand and a shortage of supply to no demand and falling prices in a matter of months.

As for BTL ,what idiots going to invest in a "negative geared" product? Well at the moments loads, and they're going to get badly burnt.I have two investment Properties bought 11 years ago, and an interest in two others. Only a fool would invest a todays prices. Many will lose their homes and end up going from Landlord to DSS Tenant in one easy move.

I was a bit young during the 80s market crash, but low and behold, everyone i know that had a house then, still has a house now... if the market crashes, then it'll no doubt build itself back up again, and so long as people don't borrow beyond their means, and so long as people are sensible enough to have savings to cover periods of high interest, then I think people are fretting and getting their knickers in a twist over nothing. Only those who borrowed irresponsibly and beyond their means will suffer.

Only a fool would invest in today's market?!? well, i guess that makes me a fool, but at least i now have my own home, and no longer paying rent (which was not much less than my repayment mortgage) to someone else, and I have no plans to sell my home in the near future...

They've been talking about property crashes for years and years and years, so it's nothing new really. sh*t happens, it's cr*p for a while, but then things recover.

Generali

pinkshoes wrote: »

They've been talking about property crashes for years and years and years, so it's nothing new really. sh*t happens, it's cr*p for a while, but then things recover.

The only problem when prices fall is that you can't move or remortgage on to a better deal. I remember a lot of stories about people struggling to raise a child in a tiny one bed flat in I]insert name of sh1te suburb[/I that they couldn't afford to sell.

FWIW, I think that house prices are likely to fall not rise long term as Baby Boomers try to cash in the family home/BTL empire at retirement.