'We've reached a tipping point' Signs of house price weakness

hpc_troll

Joeskeppi wrote: »

Some people will always see a large fall in the future which is why they spend their lives renting.

We're far enough into this now (6 years?) to know who has the right ideas and who has royally ballsed up. I don't see what the debate is about.

Because not everybody was in the market 6 years ago - some people were 16 years old and at school and legally forbidden from taking out mortgages. What about them?

Crashy_Time

ukcarper wrote: »

People expecting a large fall in the near future and people expecting large rises for ever are both as made as each other as far as I'm concerned. Can you explain the economic reality in detail because I fail to see it.[/QUOTE]


A TERRACED HOUSE THAT A POSTMAN COULD ONCE BUY EASILY IS NOT WORTH THREE QUARTERS OF A MILLION POUNDS!


Is that clear enough for you?

TickersPlaysPop

I hope the general election involves major housing pledges within manifestos.

I think it will take a major global event to precipitate a UK housing market shift... Such as China bubble popping, euro/Russia pushing one of the EU countries into default due to energy, a UKIP win at general election, Scotland voting to leave UK, Middle East multi country war maybe precipitate by Iran gaining nukes, major terrorist event... such as missing planes.... Or 9/11 repeat in another country....

Our economy is open to shocks from around the world. Free market housing is not open solely to supply/demand. I wish people would stop thinking of the housing market as a simple commodity market with the same dynamics.... homes are not simple commodities.

ukcarper

Crashy_Time wrote: »

ukcarper wrote: »

People expecting a large fall in the near future and people expecting large rises for ever are both as made as each other as far as I'm concerned. Can you explain the economic reality in detail because I fail to see it.[/QUOTE]


A TERRACED HOUSE THAT A POSTMAN COULD ONCE BUY EASILY IS NOT WORTH THREE QUARTERS OF A MILLION POUNDS!


Is that clear enough for you?

Where is that this is the kind of rubbish that defeats your argument. I first bought in the 70s and I was earning a lot more than a post man. I had to move well out of London to buy a terrace house and that house is worth no where need three quarters of a million.

System

hpc_troll wrote: »

Because not everybody was in the market 6 years ago - some people were 16 years old and at school and legally forbidden from taking out mortgages. What about them?

If I was 16 I'd be taking the advice of people who got it right. Not clinging onto the hope that someone who has been terminally wrong for 6 years might fluke it.

wotsthat

hpc_troll wrote: »

Perhaps some people really did anticipate that if we hit a bump in the road bad enough the government would end up with 80% of RBS, 43% of Lloyds (Lloyds having swallowed HBOS), Northern Rock would end up in UK Asset Resolution, along with Bradford and Bingley and the Dunfermline. That the base rate would be pulled down to 0.5% and stay there for five years, that Funding For Lending would pull the cost of the banks for retail deposits below 2% before admin costs, that the government would offer equity loans of 20% at an initial interest rate of 0% for 5 years, and extend that by offering mortgage guarantees for remortgaging on 95% LTV loans up to £600k

AKA the Scooby Doo defence "if it hadn't been for pesky x, y or z then I would have gotten away with it"

BigAunty

I do think that the first interest rate rise could precipitate a house price correction (not necessarily a crash).

I have read arguments that several small interest rate rise over a longish period of time is a very gentle way to do it and will not cause alarm.

That's a logical argument. However,the property market is an emotional place where changes can have a disproportionate impact, same stands for the stock market, where confidence drops even if the fundamentals haven't changed much.

I am browsing properties in my Scottish city and have been shocked by the sharp increases over the past few years when I've looked at historic actual prices for those on the market. I had a look at some riverside and city penthouse flats online that were seeking around 100k more, about 25-30% more than identical flats that were on the market 1 or 2 years ago. I thought 'crikey' when did parts of my city turn into London?

CLAPTON

Crashy_Time wrote: »

They don`t know it like someone who experienced it though? I know guys fought each other in trenches 100 years ago, I am interested in it, I have read about it, but I will never know what it felt like to actually be there. If you turned 16 in 2000 and are 30 now you have only known rampant HPI, with a blip where the PTB stepped in to make everything better again, HTB makes perfect sense! They can never walk in the shoes of someone in London in the late 80`s, balls deep in mortgage debt watching it all unwind?

so basically you are saying you wrote a loan of rubbish and now are withdrawing it and now proposing a new load of rubbish?
good thinking

hpc_troll

wotsthat wrote: »

I've told you exactly what I think the HPC strategy is if you think it's different then stop being coy and correct me.

I'm not surprised you've never reviewed it's effectiveness - at it's core is a faith based system. Numbers don't come into it. If Dances with Sheeple posted his numbers on HPC and even hinted it would have been better to buy he'd be banned quicker than you could say 'estate agent'.

I'm not precocious enough to claim that I'm solely interested in how the transformation of the mortgage market transformed in an unmanaged way a central part of our economic lives - hell - I'm not even going to pretend to know what you're talking about.

I'm interested in the lowest cost way to provide secure and safe accommodation for my family. The big disappointment to me is that you don't feel able to back up your position with maths rather than philosophy.

I didn't ask if you wanted prices to fall - I already knew the answer.

OK - I thought you were joking. I'm still reading a lot of hostility - and I don't understand where it is coming from. I understand that you might feel that I'm pretentious - not so sure about precocious - I think you might want to google that before you use it as an insult again. I'm not up past my bedtime. You may feel that I'm an intellectual infant, but I'm not actually 12. Anyway, even if I am pretentious, how does it advance matters to point it out? It comes off as rude, FWIW.

I think the idea that you can do the maths is part of the fallacy - unless you believe that the structure of the mortgage market doesn't matter, or that the future path of interest rates is mapped by the yield curve on the 30 yr gilt. Understanding the sensitivities of a mathematical model to its parameters is not philosophy - it's maths.

By the way - "the lowest cost way to provide secure and safe accommodation for [our] family" is for house prices to be lower than they are - surely that much is obvious? And if that is what you want for your family, why don't you want it for everybody else?

Crashy_Time

hpc_troll wrote: »

Because not everybody was in the market 6 years ago - some people were 16 years old and at school and legally forbidden from taking out mortgages. What about them?

Easy now, this is the bit that scares them, the section called REALITY, where the dwindling pennies drop that there isn`t going to be a deluge of cash rich/equity rich/credit worthy young people coming charging up the pass to take their debt/bricks off their hands at a premium.