London's luxury property market is crumbling - Terrible news for affordable housing

wotsthat

Generali wrote: »

This is a luxury property apparently:

http://www.rightmove.co.uk/new-homes-for-sale/property-37851669.html/svr/2714;jsessionid=432A9EB50C869BC1DA25C3D48FB4853B?premiumA=true

Eight hundred and fifty thousand squids for a grey house with tiny windows. At least you can buy drugs conveniently, that's a plus. You'd need the drugs to get you out the door in the morning.

It's a bargain mate.

cells

mwpt wrote: »

Prices rose 30% in two years. Wages did not rise much, population has risen but not that much. Why are houses worth 30% more and why could they not revert to a value from two years previously?

I'm not saying they will, I'm questioning why not.

For prices to crash to what they were 2 years ago requires

1: for 200,000 people to leave London
2: for the economy of London to crash more than 10%
3: for ~120,000 London jobs to be lost
4: for interest pay rates to go up ~0.5%
5: For 1 million people to leave the UK
6: For the economy of the UK to contract ~5%
7: For ~1 million UK jobs to be lost
8: For London rents to fall ~10-15%

If all that happened then yes prices could and probably would go down by that much.

westernpromise

martinsurrey wrote: »

for most of the London market that may as well be on the moon...

Agreed. It's in the Midlands and nobody I know lives there. Plus planes.

Luton, Walsall, Stoke-on-Trent - same thing.

westernpromise

Browntoa wrote: »

I'd love to see the face of some of the rich residents/owners if the developers start to fill vacant flats with "affordable" renters to avoid going bust

I know of at least one development where exactly that happened in 1990: Elnathan Mews, W9:

http://www.rightmove.co.uk/house-prices/W9/Elnathan-Mews.html

Known of course as Hellnathan Mews. About 2 or 3 houses sold then the crash came, the developer went bust and after a year the council rented them all off the receiver and let then out to families of !!!!!!. Crime just exploded - I was a mile away and they were burgling our street and stealing the stereos from our cars. The police knew all of them.

westernpromise

wotsthat wrote: »

I love London and love to visit but Luton's 30 minutes away by train and houses seem to be at least half the price. Is this the London bug in action or am I missing something fundamental?

Luton ain't no London but it's not Stoke either!

When places are cheap they're cheap for a reason.

Have a look at the type of businesses there are in beautiful Wellington Street.

It's still like Smethwick in 1981.

cells

mwpt wrote: »

Prices rose 30% in two years. Wages did not rise much, population has risen but not that much. Why are houses worth 30% more and why could they not revert to a value from two years previously?

I'm not saying they will, I'm questioning why not.

http://www.bbc.co.uk/news/resources/idt-248d9ac7-9784-4769-936a-8d3b435857a8