LAND REGISTRY data finally shows FALLS in House Prices

brasso

dannyboycey wrote: »

:rolleyes: I see you're giving yourself a warm hand at the end of the post. No confusion in my mind what that implies.

I'm applauding you for understanding the difference at last. That's the main thing.

dannyboycey

brasso wrote: »

I don't understand this thing about "calling" a crash or "calling" a downturn, as if these were official arbiters. Who exactly? One newspaper? All newspapers? One controversial columnist? Or a leading article? Are some taken more seriously than others? Where are these rules written down?

Absolutely, The Guardian and The Times have a little more political clout than the Daily Star. Although whilst that sounds obvious, it's not entirely true either as it's aimed at a different demographic. One who it could be argued play a critical role in how this will be played out. I think I'm referring to media reports en masse, e.g. a general concensus which is backed up by clear statistics. Sentiment and public opinion counts for a lot in the housing market.

brasso

dannyboycey wrote: »

What? That the housing market is actually some kind of tangible physical object swinging from a bit of nylon? I honestly don't think people are that thick. Whether you believe using the word 'literally' within a metaphor is right or wrong, I'd have thought the fact that it was actually a metaphor as opposed to a materialistic truism was patently obvious.

By using the word "literally", yes danny, that is exactly what you were saying, and that is why your mistake was funny. Leave out the word "literally", and you're fine. Put it in and you're saying something very weird indeed. That's the joke.

LOL! This is hard work.

keeperbear

phlash wrote: »

There are in effect four possible simple outcomes.
2) House prices rise, interest rates go high.........Forced to sell at profit
4) House prices fall, interest rates go high.........Bankruptcy

What rubbish! Why the heck does a higher interest rate automatically cause a person to sell or go into bankruptcy?

In your scenario 2, a 100% mortgaged borrower could remortgage to a better deal as they have built up sufficient equity to do so.

In scenario 4, if house prices fall considerably the BoE would have to reduce interest rates to save the economy. As a 100% borrower, I don't care what my property value is as long it it provides me with a home.

brasso

dannyboycey wrote: »

Absolutely, The Guardian and The Times have a little more political clout than the Daily Star. Although whilst that sounds obvious, it's not entirely true either...

Right, that's all very clear now.

dannyboycey

brasso wrote: »

By using the word "literally", yes danny, that is exactly what you were saying, and that is why your mistake was funny. Leave out the word "literally", and you're fine. Put it in and you're saying something very weird indeed. That's the joke.

LOL! This is hard work.

I'll concede that I could have perhaps articulated myself a little better, but after several beers and well past my bedtime, these things happen

I still stick by my arguments on the use of language but I'm willing to agree to disagree on this one. Lets put it to bed shall we? (there's another one )

keeperbear

Romani_Ite_Domum wrote: »

Please explain why this would be so unreasonable. The current market is 20-30% overvalued. A downslide in the market could easily cause an undershoot of 10-20% before is hits the bottom. This could take as long as 5 years to bottom out before starting to show gains again.

I think any LL will be begging tenants to stay in 6 months time. Why do you think tenants will have to move every 6 months?

Demand for property currently outstrips supply. World stock markets are also overvalued, but no one is predicting a 40% drop in share prices. Investors have to place their funds somewhere. There is no way UK property drops 40% across all areas. You are living in cloud cuckoo land if you think it will. As soon as property drops by 10%-15% investors will be snapping it up in certain areas of the country. I know I will!

Tell you what, I bet you £100 that my London property will not fall in value by 40% at anytime during the next ten years. Care to take the bet? I doubt you will. During the last "crash", my property fell by around 10% for around three years. Hardly anything to get excited about once you take into account the transaction costs from buying and selling etc.

As for renting in the UK, you are only assured of being able to rent a property for six months. After that, the LL may find a better tenant who will pay more or may sell the property. Happens all the time in my area of London.

dannyboycey

brasso wrote: »

Right, that's all very clear now.

?? It is to me.

Readers of 'red-tops' may be thought of as some kind of ignorant lower life form by some, but it could be argued that they are the crux of what happens to the housing market as they make up the majority of the house buying public!

Romani_Ite_Domum

brasso wrote: »

Personally, I think a decline of 20%, even in real terms, over a 5 year period isn't a crash. It's a decline in prices.

A 20% fall in real terms with inflation running at < 4%pa over 5 years would mean nominal HPI being 0%. Open to debate but I would class this as stagnation.

A decline would be a fall of 20% in nominal HPI. I think this would be a good thing for the majority of people.

Romani_Ite_Domum

keeperbear wrote: »

Demand for property currently outstrips supply.

London maybe, for the majority of the UK I would say that is not true

keeperbear wrote: »

World stock markets are also overvalued, but no one is predicting a 40% drop in share prices. Investors have to place their funds somewhere.

Some are. It will be interesting what happens to the world economy .

keeperbear wrote: »

There is no way UK property drops 40% across all areas. You are living in cloud cuckoo land if you think it will.

I am not calling it either way. I do however accept that it is a possibility[/quote]

keeperbear wrote: »

As soon as property drops by 10%-15% investors will be snapping it up in certain areas of the country. I know I will!

If you already have much money tied up in property, how are you going to finance this venture? If you have wads of cash lying around to do this good on you.The majority of people don't.

keeperbear wrote: »

Tell you what, I bet you £100 that my London property will not fall in value by 40% at anytime during the next ten years. Care to take the bet? I doubt you will. During the last "crash", my property fell by around 10% for around three years. Hardly anything to get excited about once you take into account the transaction costs from buying and selling etc.

Real or nominal? Real and I might well take you up on that bet.

keeperbear wrote: »

As for renting in the UK, you are only assured of being able to rent a property for six months. After that, the LL may find a better tenant who will pay more or may sell the property. Happens all the time in my area of London.

There is a whole country out there outside London. Agreed that London has it's own economy. Like I said, many LL will being hoping the tenants will not be leaving after 6 months. Not the other way round.