**Don't Buy A House** House Prices Set To Crash!!!

dougk_2

I agree

The biggest cause in any possible crash is scaremongering (and similarly can be the biggest cause of fast rises) and doom and gloomers are sucking the morale away.

If prices drop some people will gain (especially FTB's) and if they go up others will gain (BTL and investors and those moving abroad).

My personal view is that a no change would be the best solution  (no-one loses and FTB's can save and buy in a few years when salaries etc have increased). But like you say its impossible to predict and so called "experts" often get it wrong (Michael Fish and the winds for instance!).

The main purpose of a house is a place to live. Those with money buy a house those without don't... life is not fair and equal....if it was it would be a boring place and we would have nothing to discuss!

deemy2004

8)

frequent

Currently negotiating on a 3 bed circa 1845 house in south east london.

It's a shell and need a total rebuild ( planning already denied on a similar property in same street, they wanted to demolish and rebuild as did I).

So I'm planning a complete repair job, from basement to roof.

I'm hoping to use all money saving tips to get the place fixed up on schedule and budget.

Found a place on the next road up going for £225,000 but needs some work.

If my math is correct (and alowing for 10% over run) I should purchase freehold and repair it for £200,00.

If prices drop they drop, I can't help that, but I do think that buying a property in the right area at the right price can still prove to be a great investment.

Heard today that Peckham is going to get a tram system, "in the planning stage" ..so that probably means 2008 at least if it happens.

My shell isn't in Peckham but if I came across another I would look into it.

Other than that the cheapest and most upcoming area's are Plumstead, Thamesmead and Woolwich.

Cheap as chips, you can get a 3 bed in Thamesmead for £160,000, wait until the Thames Gateway takes shape ( in time for the 2012 Olympics) £160,000 will be history !

Don't buy prices set to crash, yes they may fall, but for how long and how far, if we had enough houses we wouldn't have waiting lists.

We can't build new ones fast enough to keep up with demand

The next rate decision could tip the market but in my personal opinion the goverment wil do everything in their power to prevent a price crash before the election, then after that we should all prey !

deemy2004

Yep, lets see what happens after the election.

Things at the moment are quite rosy, even 4.75% rates are not particularly high, but the housing market is drifting lower.

No ones mentioning the 'R' word YET !,
But I am afraid we are long over due for a recession, which is the direction we are drifting in.

Slowing demand, slowing momentumn, increasing deficit on trade and public sector borrowing requirement.

And don't think that cuttign rates will be possible, as coupled with a recession will follow higher rates !

Okay enuf doom and gloom enjoy your parties and the coming year. Me thinks the election will be a lot earlier than May.

Loaded_Bachelor

Prices are going down. Rental yields are now typically 5% compared to 8% a couple of years ago. This is simple maths. Mortgage rates also are at the lower end of the cycle, so long term there is far more potential volatilty of rates going up a lot but fairly lettle of them going down a lot as 3% is probably about as low as we will ever see but 10% is a possibility.

People act like sheep and ultimately do the wrong thing at the worst possible time.

Nobody wanted to buy when prices were 70% lower and mortgage payments were less than rental costs for the self same property.

But now that the equation has reversed many people still think buy to let is a sound investment and that property prices are a fair price at these levels.

When the slump comes the phrase "oh, but it is still a good long term investment" will seem irrelavent and foolish.

Buying the FTSE 100 at 6800 seemed like a very good long term investment until it went to 3400.

New properties are always being built at any given time. Its called civilisation and catering for population growth. Off hand, I think the population of England in the year 500 was 50,000. There is no "housing shortage". If there was you would see droves of homeless people and hardly any properties for sale or for rent. There are masses of properties for sale or rent.

The main reason why there has been a recent big growth in new house building is simply because the profit margins for developers have increased 30% plus in the last two years. So its a lucrative business for them to be in................. or was.

Do you think developers wuld be building as fast if prices were falling sharply but there costs remained largely static?

This "property shortage" line is spun by self interested parties as propoganda for the dim masses in order to prop up over inflated prices.

I rest my case............. your witness!!

pioneer31

Not being funny, you got it wrong last time around, you may be wrong now.  Everyone has a different opinion on the way things are going to go, and of course some will end up being right.  Just remember though, that if you end up waiting 5 years for the market to hit rock bottom you will end up having paid another 5 years worth of rent (or endured another 5 years living at home).  

Seems like you are thinking extreme long term.  However, don't forget we all only have one life and the next few years that you are waiting you will never be able to reclaim again

well if waiting 5 years means the mortgage is £80,000 instead of £180,000 then it's worth the wait IMO, especially since you'll have stashed away savings in that time which will give you a BIG deposit.

You do only have 1 life but do you want the rest of it to be debted o the eyeballs?

pioneer31

Prices are ridiculous now.

The whole market was talked UP with scaremongering about 'not being able to get on the ladder, hurry hurry, it's your last chance' and all that.

Now I would like to see the market talked DOWN. Nearly all surveyors agree that houses are grossly overpriced, People are taking out HUGE mortgages with little thought as to the future of interest rates (they won't stay low forever, why should they? they've swung all over the shop in the last 30 years), unemployment, the economy etc etc.  

people who believe that the economy will be rock steady forever are either stupid, politicians or banks/EA's.

It's about time this whole ridiculous bubble which is causing misery for millions of FTB's is popped in dramatic style.

pioneer31

Who the heck wants to get in debt for 35 years just to buy an overpriced house?  If you can't afford a house within 25 years then don't buy.  There will be lots of other people in the same position and eventually the market will cool down so that you can afford to buy.  It might take a few years to happen but surely it has to be worth waiting a few years?

well said

deemy2004

Fastforward 2 years

New TV show - Reposession, Reposession, Reposession

Phil and Kirsty guide their previous house buyers through various ways of coping with reposessions from moving back in with their parents, to putting in offers at the homeless shelters.

deemy2004

This housing market is well and truly gone crazy...

1 out 10 are FTBs
The rest are either property developers or landlords !