Has the housing market hit freefall yet?

chunter

No matter what nonsense the yearly stats are coming out about house price rises, I know that at least 2 estate agents in a local provincial town have big windows full of houses and absolutely no one looking.

Even the speculators have stopped.
They're trying to shift the stuff they have left.

I think it's called 'realignment' or 'reality' or something like that.

It's not "What you can I get for this house at the moment?",
it's "How low do I have to go to get a buyer?"

It's a buyer's market now and there's very few of them.

bingo_bango

chunter wrote: »

I think it's called 'realignment' or 'reality' or something like that.

I like that line.

As for the title of your post, I think you may possibly be waiting on a non-event here.
Yes, prices have slowed, and yes, buyers have stopped voting with their wallets, but I don't think the situation is as dire as some would lead you to believe.
With the state of the markets the banks use, no-one is ready to make a move. BOE didn't introduce the last expected interest rate rise as they were satisfied that the market was slowing considerably (well....that and the Northern Rock fiasco. I personally feel that the information about NR was leaked with full knowledge of BOE, in an effort to bring the market down).

I just don't see a realignment of prices, at least not in line with that the Republic has experienced recently. I think the investors are biding their time. They'll wait another couple of months, release all sorts of doom and gloom news, and then seek to cash in on those trying to downsize and reduce any 'possible' negative equity. Quick sale for cash anyone?

Of course, this will work with some people. Probably the same ones who rushed out to buy as big a house as the banks would let them, in the vain hope of a quick 30-50K profit.
I actually feel sorry for most of those people, as a lot of them are now in the position of having huge mortgages, likely more than they can realistically afford, and have nowhere to go. They will suffer when the vultures start to move in.
Were they greedy....of course they were!
But were they stupid? All their neighbours sell up for a nice fat profit. Move to bigger house, same mortgage.....surely we can do that? Unfortunately, not everyone can play the money game well. That's the nature of capitalism, and it won't go away.
I don't see a return to the 80's and record repossessions, but yes, some people will lose their home. I feel sorry for anyone in that position (I sat tight during the madness. Still quids in even if the market does drop), and hope that the relevant agencies have prepared for the torrent of enquiries they undoubtedly receive.
From your post I can only take that you are an interested observer like myself, and will still be in your home this time next year, able to discuss what has happened since.

Let's hope it's on a happier note!

talksalot81

The simple reality is that young people cannot afford to buy and it will take a large drop to change that. They thus cannot support the market where it is. To stay at current levels we therefore need older individuals to hold up the market. This no longer covers investors because it has become clear that it will not be profitable at the current levels. So one relies on the market being propped up by those somewhere further up the ladder - probably those one might describe as 'parents'. The only problem is that, with a market no longer going crazy, they now have lost their MEW income source. So they are more than likely able to hold onto their properties and be comfortable, but they will no longer have the ability to use their home like a chargecard and fuel the lower end of the market, be it for investment or simply to help the kids.

The fundamental conclusion is that the current level is unsustainable. Almost everyone who debates this ignores the question of where the money is going to come from to hold it there.

IvanOpinion

On the BBC site today
I think a lot of people are waiting to see what the bank may doing in relation to the credit squeeze. There is a possibility that interest rates could drop again (instead of the predicted rise). However there is also a possibility that banls could shut the door to credit for many people.

Ivan

leftieM

I'm going to predict that there is a fall in prices coming - prices have already fallen by 10% here in Finaghy. I'd give it another 30% before it's at a level where owner occupiers feel they can confidently re-enter the market. I think it'll be quick but pretty painless for most of us in that it won't be accompanied by a recession.

If you are interested in the housing market there is a special Northern Ireland board at housepricecrash.co.uk where the posters there put any media articles relating to property prices in NI. Saves you having to bother to look yourself!

championmongo1

After looking at propertynews.com and speaking with the local estate agents property prices in Carrickfergus have jumped back to where they were in June (which is when they had previously peaked before dropping off a little!) and more and more houses seem to be going sale agreed again!! And if they are being truthfful-Yippie! :money:

Although mine is still not sold :mad: ! Which is frustrating as I'm not a speculator-I just want to join my fiancee in England (she moved at the end of August for work-leaving me here by myself!)

Parisien

leftieM wrote: »

I'm going to predict that there is a fall in prices coming

Oh please.........!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

That was meant in a sarcastic way.....:rotfl:

terrierlady

midlands and south west prices have fallen according to our market research and yes without FTByrs the market does collapse.

leftieM

Parisien wrote: »

Oh please.........!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

That was meant in a sarcastic way.....:rotfl:

I'm confused. I presume that you either totally disagree or are laughing because it's so obviously true.
Hell, my guess is as good/bad as anyone's. I'll go so far as to put my money where my mouth is. [STRIKE]£10 [/STRIKE] £5 says I'm right. Are you big enough to see me on that? Huh? Huh?

I find this type of discussion interesting on a nerdy macroeconomic level. However sometimes I'm reminded that there are plenty of people who were sucked into this bubble who will pay the price if house prices fall, and plenty of people who can't get a house or move from their current one because they can no longer afford to. I want everyone* to win.

*Except investors who aren't relatives or friends and estate agents.

Parisien

Leftie.....why state the obvious or what will eventually happen......we all know ifs its dry today, tomorrow - if you predict it will rain sometime then of course you will eventually be right.......

I would be more impressed if you had said 5 years ago....house prices would rise until May 2007.......so...go on...tell me something/anything I don't know!!

chunter

http://www.rte.ie/news/2007/0928/economy.html

The Irish goverment's "thinktank" announced today that they reckon house prices down south will fall 15% in the next year.

Now we know there's a strong correlation between the two housing markets, (we're just a year or two behind) it's just how strong...