House Price Crash Discussion Thread

Generali

tr3mor wrote: »

6 years of inflation at the current RPI level of 4.1% per annum would still be 27.3%.

I think we need to start ignoring Gordon's made up CPI.

It would and using a CPI rate of, say, 2.1% instead would give a figure of 13.3% so I know which I'd like my pay rise based on!

It's not a case of ignoring CPI or RPIx or RPI or any other inflation measure, it's a case of understanding that there isn't and can never be a single, one size fits all measure of inflation for a free market economy as prices of different things will rise by different amounts and people spend money in different ways.

CPI is meant to be an inflation proxy and in at least one speech, Merv 'Elvis' King said that it wasn't actually meant to be a measure of anyones actual experiences.

My feeling is that RPI is a decent measure of inflation and reflect the actual experiences of many people. RPIx can be helpful at times when interest rates are very volitile to get a handle on what's going on 'behind the scenes'.

John_Pierpoint

Your mortgages pay my savings income, it is a generational thing.
Hopefully I've got a family (and a bit of s stash) so you won't have to pay my care home fees.

redmen9

I think that what people are missing in the above posts regarding prices dropping and rising over years, is the fact that such a large proportion of potential buyers are priced out of the market today.

Prices are free to rise IF people can afford to pay the inflated price. Once the prices have risen beyond the point that the vast majority of people can afford , then something's got to give! Surely!!

Lotus-eater

Do you know what I think is going to make the biggest difference this time?
This site, or not really this site but the internet as a whole.
Last time in the late 80's if you really wanted to know what was going on (more than news at ten and we all know how much we believe tv now) you had to eat a prawn cocktail starter and sit next to an annoying estate agent at a dinner party round your mates house.
The level of information is huge, alot of it made up and in peoples heads, but its still there. Information from people in the know and from all areas.
In what way will it make a difference? Thats a good question, but it seems to be making it move faster to me, its not that house prices seem to be walloping down quickly, more that peoples attitude is changing quicker.

Nenen

Lotus-eater wrote: »

Last time in the late 80's if you really wanted to know what was going on (more than news at ten and we all know how much we believe tv now) you had to eat a prawn cocktail starter and sit next to an annoying estate agent at a dinner party round your mates house..

:rotfl::rotfl::rotfl::rotfl::rotfl:
What a wonderful picture that conjours up! :rolleyes:

Nenen

Saw a house a few weeks back for 285K. We liked the house although I didn't like the fact that it was very near a main road with lots of traffic noise (which drives me crazy). However, dh convinced me that I'd get used to the background hum... not sure if he's right as even the fan on my PC annoys the hell out of me sometimes! Anyway, we offered 250K which they unsurprisingly turned down.

A couple more weeks went by and the price on RM dropped to 275K. We got a phone call yesterday (another 3 weeks later) saying they would now accept our offer of 250K. My problem is, and I feel really guilty about this, I'm not sure if I want it now. The more I think of the road noise etc the more uncertain I've become. My heart is telling me to say 'thanks very much but as they turned down our offer we are no longer interested' but another bit of me feels terribly guilty for having second thoughts, I don't want to disappoint the nice young couple and I'm not sure if we will get anything better. Any thoughts?

Lotus-eater

Nenen wrote: »

:rotfl::rotfl::rotfl::rotfl::rotfl:
What a wonderful picture that conjours up! :rolleyes:

Yeah, funny thing is, prawn cocktails are back in fashion (apparently) and estate agents are still annoying, these combined with the fact that dinner parties are also "back in" lead me to believe we have exactly the same conditions as the late 80's, therefore a crash is inevitable

Lotus-eater

Nenen wrote: »

Saw a house a few weeks back for 285K. We liked the house although I didn't like the fact that it was very near a main road with lots of traffic noise (which drives me crazy). However, dh convinced me that I'd get used to the background hum... not sure if he's right as even the fan on my PC annoys the hell out of me sometimes! Anyway, we offered 250K which they unsurprisingly turned down.

A couple more weeks went by and the price on RM dropped to 275K. We got a phone call yesterday (another 3 weeks later) saying they would now accept our offer of 250K. My problem is, and I feel really guilty about this, I'm not sure if I want it now. The more I think of the road noise etc the more uncertain I've become. My heart is telling me to say 'thanks very much but as they turned down our offer we are no longer interested' but another bit of me feels terribly guilty for having second thoughts, I don't want to disappoint the nice young couple and I'm not sure if we will get anything better. Any thoughts?

Yep, drop it like a hot brick!

Any second thoughts about houses, especially atm should tell you not to buy.

MissMoneypenny

Nenen wrote: »

Saw a house a few weeks back for 285K. We liked the house although I didn't like the fact that it was very near a main road with lots of traffic noise (which drives me crazy). However, dh convinced me that I'd get used to the background hum... not sure if he's right as even the fan on my PC annoys the hell out of me sometimes!

I lived in a house like that (a field away from a main road) and never got use to the noise. It was even worse in the summer when the windows were open or we were in the garden. Wonderful house, but wrong location. I was so glad when we sold it.

merlinthehappypig

Nenen wrote: »

Saw a house a few weeks back for 285K. We liked the house although I didn't like the fact that it was very near a main road with lots of traffic noise (which drives me crazy). However, dh convinced me that I'd get used to the background hum... not sure if he's right as even the fan on my PC annoys the hell out of me sometimes! Anyway, we offered 250K which they unsurprisingly turned down.

A couple more weeks went by and the price on RM dropped to 275K. We got a phone call yesterday (another 3 weeks later) saying they would now accept our offer of 250K. My problem is, and I feel really guilty about this, I'm not sure if I want it now. The more I think of the road noise etc the more uncertain I've become. My heart is telling me to say 'thanks very much but as they turned down our offer we are no longer interested' but another bit of me feels terribly guilty for having second thoughts, I don't want to disappoint the nice young couple and I'm not sure if we will get anything better. Any thoughts?

Hi Nenen.

This has happened to us several times in the last 6 months where have made an offer, had it rejected and moved on, only to find that the offer is accepted weeks or months down the line. In each case we no longer wanted the house, having seen others, refined criteria etc etc. One of the houses was eventually offered to us for £35000 less than our offer and £70000 less than the seller said they would take at the time.

I didn't feel at all guilty and neither should you. They had their chance and said no. It's not your fault that they were sticking out for more money and that the market is starting to deteriorate now. To be honest if you want the house I'd offer them less as the market has changed, but I'm still feeling generally grumpy about houses and sellers and I know that you are nicer about these things than me!

Look on it as a positive sign that prices are starting to move downwards.

It really doesn't sound like you want the house and you certainly shouldn't buy it because you feel any obligation to the seller.