House Price Crash Discussion Thread

exil

I won't say how old I was.

neas

neverdespairgirl wrote: »

I was 17 then, and paying no attention whatsoever!

Same lol, I was 12 :P

Generali

!!!!!!? wrote: »

Gold is of course another traditional way to hold your 'money' when financial systems look shaky. Gee - it seems to have been rocketing in price over recent months. I wonder why....

I'm looking at putting of much of my cash as I can into NS&I products. They're the only 'guaranteed' way to hold sterling cash assets ... well, I suppose Northern Rock might be too but I really don't trust the govt to make good on their 'guarantee' there.

Glad to see you're finally coming around to the view that this will be very, very bad indeed. You've always seemed quite optimistic until this point.

Well there's a bit more too my views than that. I was chatting to a hedge fund trading mate who pointed out that I'd been on about the potential problems of excess credit, falling risk premiums and the problems of unwinding derrivatives positions if an Investment Bank goes belly up for four years.

The thing is, I am hestitant to say, "It's all going horribly wrong this time" because it so rarely does. Capitalism and the human ingenuity that it uses is so powerful and incredible a thing that it has an amazing way of pulling itself from the abyss. Not through the actions of Society or of Government or any other agency but by the aggregated decisions of individuals. Its amazing to me and its one of several reasons why socialism is doomed to fail every time.

I've had a very nasty feeling about this for a long time and I'm starting to think that some of my darker fears may be right. I still feel that the problems are resolvable - for example, enterprising Americans are buying up debt cheaply and saying to the homeowner or car owner, "I'll do you a cheaper interest rate than you were paying. Tell me what you can afford." If you can buy the debt cheaply enough then the buyer of the debt makes a profit and the homeowner gets payments he can afford. Someone's going to make a lot of money doing this in the next few years I suspect.

TBH I think the biggest problems in this will be caused by Governments trying to resolve them. For example, Obama and Clinton have been making some pretty dark protectionist noise in the rust belt. I feel that the best policy response will be to keep the financial system going, wipe out equity holders and jail any senior management that can be pour encourager les autres.

!!!!!!? wrote: »

I know exactly what you mean about the misguided notions of people who are seemingly looking forward to the coming recession as they think it will provide good opportunities for them. It might, for a few. For most people it's going to be at the very least an extremely uncomfortable and unsure time. That's why those who think a house price crash will be avoided by buyers jumping in once prices fall a little bit are going to be proven wrong.

I agree whole heartedly. If we have a Lost Decade then £50k isn't going to carry you that far. The biggest problem the housing market faces in this country (one its faced for as long as I can remember) is that people think they're buying an investment when they should be buying a home.

ManAtHome

exil wrote: »

I wonder how many people are confidently predicting a crash can put their hands on their hearts and say that in 1995 they predicated the housing market would have headed upwards for 12 years without a break.

I wonder how many people in 1995 would have imagined a conversation with a bank going something like...

Hello, you don't know me but I earn 65K pa a want to borrow £260k
Ok, yeah that'll be good, sure you don't need an extra £30k for a flash car and a "nice likkle olliday"....

Lotus-eater

exil wrote: »

I wonder how many people are confidently predicting a crash can put their hands on their hearts and say that in 1995 they predicated the housing market would have headed upwards for 12 years without a break.

No one I bet, because the last crash was still a bad taste in the mouth and everyone seemed to be playing it safe with houses.

Luckily human memory is extremely short, especially where money is concerned

Turnbull2000

Anybody interested in helping restore some balance on this Digital Spy thread?

This is what you're up against...

You are only jealous because you want to buy property and cannot afford it.

If you say property isn't such a great idea right now, then you'll be hounded out. Would appreciate some comments :beer:

mr.broderick

Turnbull2000 wrote: »

Anybody interested in helping restore some balance on this Digital Spy thread?

This is what you're up against...

Lol Big advert for fitness for gay men popped up.

Turnbull2000

mr.broderick wrote: »

Lol Big advert for fitness for gay men popped up.

It's a very liberal forum. Anything goes really... apart from suggesting house prices may fall :eek:

MissMoneypenny

Turnbull2000 wrote: »

It's a very liberal forum. Anything goes really... apart from suggesting house prices may fall :eek:

I noticed you were on there under the same name;)

WTF?_2

Some pretty scary stories in the Sunday papers. Here's one from the Independent:

http://www.independent.co.uk/news/business/news/wall-street-fears-for-next-great-depression-796428.html

In the UK, Michael Taylor, a senior market strategist at Lombard, the economics consultancy, said on Friday night: "We have all been talking about a 1970s-style crisis but as each day goes by this looks more like the 1930s. No one has any clue as to where this is going to end; it's a self-feeding disaster." Mr Taylor, who had been relatively optimistic, has turned bearish: "It really does look as though the UK is now heading for a recession. The credit-crunch means that even if the Bank of England cuts rates again, the banks are in such a bad way they are unlikely to pass cuts on."Mr Taylor added that he expects a sharp downturn in the real UK economy as the public and companies stop borrowing. "We have never seen anything like this before. This is new territory for us. Liquidity is being pumped into the system but the banks are not taking any notice. This is all about confidence. The more the central banks do, the more the banks seem to ignore what's going on."

:eek: Yet, still plenty prepared to bury their heads in the sand on this forum it seems.