London property prices to fall 30%....

padington

Thrugelmir wrote: »

When a 3 bed terrace house sells for 500,000. Then you know something is wrong.

You can buy 4 similar properties here for the same money.

Where is here ?

Generali

padington wrote: »

Where is here ?

Northern Hell Hole. We already established that IIRC.

ging84

i don't see it crashing, but slowing down maybe, but i don't see any real triggers of a crash on the horizon.
But in the really long term i would be quite worried if i was an investor, you can't migrate a whole nation to it's capital, at some point it's draw will run out and for the remaining people who might consider it, the costs out weigh the benefits. Since one of the benefits of recent years has been you can buy a house for a stupid amount of money, and it will earn more than you do, take that away and suddenly you have a lot of people who can barely justify living in the capital, which could send the flow into reverse and snowballing quite quickly into something of a crash.

Jon_B_2

I don't subscribe to the whole HPC rhetoric, but more than ever it is clear to me that in the SE/London there just has to be a correction.

But on that, I'd suggest the SE region rather than London itself is more at risk - London will always hold its prestige for international investors.

The fact that the price differential between a 90 mile stretch of the M4 of Bristol and Slough is so incredible suggests to me that it just isn't sustainable.

Mistermeaner

Trouble is people won't sell at a loss, they just sit tight

Generali

Mistermeaner wrote: »

Trouble is people won't sell at a loss, they just sit tight

Someone (MSCI?) did some research on that recently and the result they came up with was that HPIs don't reflect a falling market properly. The reason? When markets fall people simply refuse to sell for 'less than the house is worth'.

Instead of falling markets reflecting the price houses could sell for they reflect the lack of liquidity in the market.

GDB2222

Mistermeaner wrote: »

Trouble is people won't sell at a loss, they just sit tight

There was a big crash between 1988 and 1995. People who could sit tight did so, but there were forced sellers, eg deaths, redundancies and divorces. Of course, interest rates were much higher at that time, making it harder to sit tight than it would be currently and there was less support from the state.

lisyloo

There are always people who can't sit tight. Death, divorce etc.
I know of a few cases where individuals (usually men) have taken a haircut to get a clean break from a relationship. It's usually the man that has the earning potential and therefore the ability to move on. After a certain period of time people want to move on.
If I had an inheritance I'd want the money asap and not to have the issues of cutting the grass, insuring an empty house etc.
Prices are set at the margins.

I can understand householders wanting to sit tight, but what about a Chinese/Malaysian investor with a empty London flat. Will they sit tight or will they take a profit?
I think properties at battersea/nine elms might take a hit.
Will oo's rush in whilst they are falling.
As a potential OO I can say I would NOT rush in. I would wait and yes I know that's a risk.

lisyloo

Thrugelmir wrote: »

When a 3 bed terrace house sells for 500,000. Then you know something is wrong.

You can buy 4 similar properties here for the same money.

A Barrett studio at Minster house is £975k (not far from Parliament square).

roneik

By this time next year us lot in the grim north will be saying "it's grim down south"
All those funny money prices and nobody buying, oh dear
Keep hearing that song back to reality in my head.
Who would have thunk it eh,

975k for a studio, that's enough money to buy a dozen good houses up here and have change