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Debate House Prices
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UK property crash
Comments
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Problem is that there are more buyers than sellers by a long chalk. London is increasing population by a new borough of people every three years. The rental on property is always going to be an amazing earner. Expect a dip and be quick to buy in it but don't miss the boat because it won't last.
but buyers need money, which at the moment is not forthcoming.
i'm not sure about rental being an amazing earner- yields are very low, as are rent rises (a shade above inflation, i believe).
i think a dip may be brief due to QE or government props, not free market fundamentals.0 -
jjlandlord wrote: »Supply might (do you know?) be increasing more than demand is increasing.
However I am rather convinced that supply is still way below demand.
Just look at the commuter trains and roads into London every day...
a large chunk of that demand was foreign money, which has now dried up.
if you look around stratford you'll see hundreds of cheaply built new builds going up. the first lot sold off plan before a single brick was laid. the current lot are having their prices cut even though they are not due for completion for several months (years in some cases). its a classic building bubble. there is no prospect of finding enough people to live in them, let alone buy them.0 -
Bubble_and_Squeak wrote: »but buyers need money, which at the moment is not forthcoming.
i'm not sure about rental being an amazing earner- yields are very low, as are rent rises (a shade above inflation, i believe).
i think a dip may be brief due to QE or government props, not free market fundamentals.
About rental - Sorry should have said amazingly reliable earner however yields are the next to rise, it couldn't go any other way. With so many people joining the party and such little building, in zone 3 inwards anyway. Supply and demand innit.
About buyers needing money - Watch the government announce more and more fractional ownership schemes. Then watch incomes rise. Then watch the powers at be remove borrowing restrictions. See the return of the 100% mortgage. Watch interest rates go lower. Then watch them make loop holes for more foreign money. Then watch the BTL brigade keep buying steadily. Then watch prices go up again.Proudly voted remain. A global union of countries is the only way to commit global capital to the rule of law.0 -
Osborne has launched help to buy TV adverts today - just as the electioneering is being ramped up - so the implication is that he considers the housing market as absolutely pivotal to his political prospects.
The implication from the implication is that Osborne aint gonna let the housing market correct on his watch
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About rental - Sorry should have said amazingly reliable earner however yields are the next to rise, it couldn't go any other way. With so many people joining the party and such little building, in zone 3 inwards anyway. Supply and demand innit.
About buyers needing money - Watch the government announce more and more fractional ownership schemes. Then watch incomes rise. Then watch the powers at be remove borrowing restrictions. See the return of the 100% mortgage. Watch interest rates go lower. Then watch them make loop holes for more foreign money. Then watch the BTL brigade keep buying steadily. Then watch prices go up again.
not if labour win!0 -
Bubble_and_Squeak wrote: »not if labour win!
All their energy is currently spent trying to fix a coalition with the tories at the mo. Even they don't believe they are going to win. It's coalition time again, they've lost Scotland, they're going to keep Ed and he's just not seen a 'winner' By the public.
So can't see that one happening. People tend to vote labour to share the winnings and Tory's to make some winnings. People don't feel there are any winnings to be shared at the mo.Proudly voted remain. A global union of countries is the only way to commit global capital to the rule of law.0 -
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Problem is that there are more buyers than sellers by a long chalk. London is increasing population by a new borough of people every three years. The rental on property is always going to be an amazing earner. Expect a dip and be quick to buy in it but don't miss the boat because it won't last.
London is not UK!Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are incapable of forming such opinions.0 -
I'd love there to be a house price crash in London. Currently I doubt I'll ever be able to afford anything
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I find this topic really interesting - I read a lot on this topic and always find that both sides of the view are so emotionally involved.
This is my perspective.
1. The argument I keep hearing and I agree long term with is 'we don't build enough property in the UK'. The balance is maintained via demand and supply - higher prices, more supply eventually comes along... very much like the oil market and every other market that's ever occurred. Property due to regulation in the UK takes longer to build...
2. Property is linked to credit supply in the short term. We have just had a cut in the credit supply via tighter affordability thresholds.... this will dampen demand.
3. Opportunity cost - there is a real lack for alternatives for money at the minute. Holding property instead of selling it isn't a terrible investment and the cost for this isn't great... for example, I looked at a property the other day and the seller didn't want to negotiate even though it was on the market for 6 months... the lack of opportunity cost for this seller and the fact money is realtively cheap... probably prevents the market from reducing in price.
4. Probably most importantly... when interest rates are low, asset prices and income inequality is high. We are seeing that now. Will interest rates rise? My personal opinion is that there is just too much debt in the system still... there isn't incentives for people to reduce it/ indivduals can't afford too... and although people say the central bank is independent... its not... and no one wants to be responsible for kicking people out on the street even though the rest of the economy probably would benefit from a re-pricing of money.
I don't know whether there is going to be a crash, but I am not basing my investment decisions on whether property this or in 5 years will drop 30%-50% etc. You can't... timing for investments is practically impossible...My Goal: From 1st of Jan 2015 to 31st of December 2015 is to save 30000.
48.78% towards 2015 target.
105.3% towards 2014 target. :j0
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