House prices

chucknorris

economic wrote: »

28 years is a very long time. its makes you think right. when you hit 60 you still need to have a pretty decent financial cushion to live a comfortable remainder of your life.

I certainly wouldn't want to suddenly start realising that I should have bought a property decades ago, that would now be mortgage free, not only offering much cheaper housing, but also a significant amount of equity that could be tapped into, if necessary (although we aren't particularly planning or relying on that).

Crashy_Time

lisyloo wrote: »

I think we are perhaps talking at cross purposes.
I'm talking about getting transaction levels going again, not proping up a bubble.
I think a moderation in prices would be a good thing for young people in particular.
I don't forsee a crash which requires lots of people to be out of work (a 0.25% rate rise will only compromise a few people who are highly indebted anyway).

Stamp duty appears to be a barrier to people moving.

BTW - the building isn't burning for most people.

You don`t need lots of people out of work for a crash, just lots of people unable to afford house prices, and we are already at that stage.

phillw

Crashy_Time wrote: »

You don`t need lots of people out of work for a crash, just lots of people unable to afford house prices, and we are already at that stage.

Even then that can cause stagnation in the market, which can lead to fewer houses being sold which can lead to higher prices.

House price crashes only come when a large number of people lose confidence in the market and decide to sell up quickly to avoid the coming crash.

chucknorris wrote: »

I certainly wouldn't want to suddenly start realising that I should have bought a property decades ago, that would now be mortgage free, not only offering much cheaper housing, but also a significant amount of equity that could be tapped into, if necessary (although we aren't particularly planning or relying on that).

I do regret not buying decades ago, fortunately I bought a decade ago. Supposedly the value has increased, but I've had to pay interest on the money I borrowed which probably cancels that out. So if I sold it tomorrow then I'll have lived rent free for the last ten years. If I'd invested the money elsewhere then I might have been able to cover rent at one point, but certainly not now.

Saving the deposit and paying the mortgage when it was >5% was hard, 12 years later and I'm nearly done.

lisyloo

Crashy_Time wrote: »

You don`t need lots of people out of work for a crash, just lots of people unable to afford house prices, and we are already at that stage.

I disagree.
There have been loads of people unable to buy in London for many years and house prices havent crashed. That’s because there ARE enough people that can afford it.

What you say is clearly untrue as we don’t have a crash right now.
If you disagree show us the evidence (and I don’t mean the bbc saying prices are falling in only 4 places in the country).

phillw

lisyloo wrote: »

I disagree.
There have been loads of people unable to buy in London for many years and house prices havent crashed. That’s because there ARE enough people that can afford it.

What you say is clearly untrue as we don’t have a crash right now.
If you disagree show us the evidence (and I don’t mean the bbc saying prices are falling in only 4 places in the country).

You always struggle with volatility at the extremes. I'd never buy a flat because they are expensive but then suddenly nobody wants one and the prices squash right down. That attractive three bedroom house that you paid a premium for, is just the same as any other three bedroom house when the market slumps.

London will probably struggle post brexit if the government decides that no deal is better, but it's currently remaining high because demand is constantly outstripping supply.

If you don't get repossessed then any money you put into property is relatively safe and the mortgage companies are being much more responsible so the chance of being repossessed is much lower than it was. Most people win, a few people lose. It's better odds than renting, where everyone loses.

Crashy_Time wrote: »

And the headline just feeds into people`s "fears" about rising rates, Brexit etc. Excellent.....:rotfl:

Brexit is probably detering people from buying in London, when that happens the market slows down as people don't like perpetually having their property on the market (it affects your well being and people don't want to buy a property that has been on the market for 12 months). Whether the lack of sales is propping up the market is someone we can't tell just yet. You'll probably have to wait until we've tasted the flavour of brexit.

Investments are funny things though, if there was a slight drop in London property prices that triggered a mass sell off then there are likely people hanging around waiting to buy. So the prices will never drop to a level when someone like me would be able to pick something up for a steal.

I'm way more worried about being able to afford food post brexit, than seeing the equity in my house disappearing.

Crashy_Time

lisyloo wrote: »

I disagree.
There have been loads of people unable to buy in London for many years and house prices havent crashed. That’s because there ARE enough people that can afford it.

What you say is clearly untrue as we don’t have a crash right now.
If you disagree show us the evidence (and I don’t mean the bbc saying prices are falling in only 4 places in the country).

https://www.bloomberg.com/news/articles/2017-11-09/london-house-price-slump-persists-as-brokers-see-sales-tumble


Bloomberg are saying it is toast basically.

Crashy_Time

phillw wrote: »

You always struggle with volatility at the extremes. I'd never buy a flat because they are expensive but then suddenly nobody wants one and the prices squash right down. That attractive three bedroom house that you paid a premium for, is just the same as any other three bedroom house when the market slumps.

London will probably struggle post brexit if the government decides that no deal is better, but it's currently remaining high because demand is constantly outstripping supply.

If you don't get repossessed then any money you put into property is relatively safe and the mortgage companies are being much more responsible so the chance of being repossessed is much lower than it was. Most people win, a few people lose. It's better odds than renting, where everyone loses.

No, many are now finding that there are no buyers, money in property you can`t sell is dead money, it doesn`t exist.

GreatApe

Crashy crashy crashy

Just download some software and block that house price crash cheer leading website all it does is reinforce incorrect biases

Volumes have not crashed. They are roughly 100,000 a month or 1.2 million a year that is not no sales that is a lot of sales. On top of that there are also transfers outside of the land registry figures like between family members gifting property or inherited property.

Seriously you don't want to be one of the fools of that crash cheering website. Every month I visit for a quick look the same idiots there are salivating that the crash is just weeks away and will recover their 10-15 year short bets and then some. Its tragic

GreatApe

The biggest mistake the crash cheerleaders made was the absurd notion that a man on the average wage should be able to buy the average property. It sounds right but it's so wrong. Its made even more Wrong by the fact that most the crash cheerleaders are men and have this stupid idea that women in the past didn't work so they are entitled to be able to buy a 3 bedroom house all by their lonesome.

A much better model would be that the top 1/3rd of properties would be bought with capital wealth things like Inheritances and business sales etc

The middle 1/3rd is for second time buyers

The bottom 1/3r is for FTBs

And this would be at a national level. So a property in London even a small crappy one which is in the say 25th percentile in London is actually more like the 50th percentile nationally.


If you model the market like that things look absolutely fine.
Nationally the mid point of the bottom 1/3rd of properties I'd only around £100k which is easily affordable for even a couple on the min wage. Luckily most couples even young FTBs are on more and also have family help.

There is no housing problem there is no housing crisis just a rational functional market and irrational commentators and crazy crash cheerleaders who have been waiting 15 years

GreatApe

The real intriguing question is not why are prices high today, they are not

The actual question should be why were House prices so so cheap in the 1999s.

During the mid 1990s in some London areas you could buy a house for just material cost which means you got the land and labor and utility connections and adjacent infrastructure for free. It was a period of amazingly undervalued housing prices in London.