When will London burst ?

mwpt

Role reversal.

Bears: What would you think would keep London prices moving upward?
Bulls: What would you think would crash London prices?

Generali

mwpt wrote: »

Role reversal.

Bears: What would you think would keep London prices moving upward?
Bulls: What would you think would crash London prices?

I'm not really either TBH.

I probably wouldn't use the word crash.

I reckon investor money is the most likely thing to keep prices rising. Prices in most of London must surely be too much for FTBs to afford.

The thing most likely to make them fall would be a sharp rise in rates coupled with a rise in unemployment. As we saw in the GFC, without forced sales people just hang on until prices recover. As stupid as it might sound, people won't sell their house for 'less than it's worth' even if the market price is well below what the house is 'worth'.

A bank repossessing a house doesn't give a flying fox what the 'owner' thinks it's worth and just gets what it can.

That's why it normally takes forced sales for prices to fall. In the UK anyway.

lisyloo

I'm not either, so going to answer both.

Bears: What would you think would keep London prices
moving upward?

Increasing population fueled by open door immigration in Europe - check.
Liitle housbuilding and tight planning restrictions - check.
De-indutrialisation causing the intellectual jobs centered in London - check.
Ecomony doing OK - check.

Bulls: What would you think would crash London prices?

Major terrorist event like 9/11.
Serious health scare - like Ebola, sars, bird flu etc (only worse).
Major economic crash.
Mass unemployment.

Personally I'm expecting the status quo - on and on and on again :-)

Generali

Gotta be honest lisyloo, I'm with you. This is so obviously the start of another housing bubble in the UK. Inside a year or two there'll be regions rising at 2-3% a month or something equally daft.

caronoel

chiefie wrote: »

For you economics experts out there . How can house prices continue to rise whilst the service economy depends upon continued low wage employment ? And whilst key public sector workers aren't paid enough to buy or rent somewhere ? how does this work and where is it all going ?

You missed it matey

London house prices "burst" in 2008, and are now 40% above that level.

Next crash is due in about 10 years, but we have a loooong way up to go before then

chiefie

I'm not wishing for it but as a bear with very little brain sooner or later the people on lower wages will have to exit stage left

wotsthat

chiefie wrote: »

I'm not wishing for it but as a bear with very little brain sooner or later the people on lower wages will have to exit stage left

You'd think so but as far as I can see London is full of people moaning about the cost of housing but refusing to move somewhere cheaper.

It seems fairly obvious what'll happen - the same as in the past. Prices go up quickly and then fall quickly; that's what house prices do and the reasons for this will have nothing to do with low wage persons heading out into the scary world outside London.

wymondham

I thought it now policy to protect and promote housing bubbles? Surely they are not allowed to burst anymore as everyone knows housing bubbles are a good thing and make us all richer?? Bring on the helium they cry in Westminster! (home of the landlords....)

purch

wymondham wrote: »

I thought it now policy to protect and promote housing bubbles?

It was a major part of the manifesto of the Official Monster Raving Loony Party, but I am not sure it became policy

setmefree2

chewmylegoff wrote: »

Won't somebody please just think about the children.

This really has become a problem for the children - the children of Londoners. These "children" are young adults who have only ever lived in London and know nothing else...

Watch this space, I will let you know what's happening to them - my kids are 21 and 19 and both away at Uni. My friends kids range from 30 to 12. I don't know any who have bought a property yet - they are all (mostly) still living in their childhood bedrooms having returned from Uni or have gone abroad.