House Price Crash Discussion Thread

LisbonLaura

i082327 wrote: »

Are you kidding me, you can't make sweeping statements like that, if i apply that to my current £110000 property that would make it about £25000 and I could get a mortgage to buy about 6 of them?

Madness

I am not kidding.
We will see who has the 'madness' in a few years time.
By then you will be in no doubt as to how bad things are.

WTF?_2

LisbonLaura wrote: »

I am not kidding.
We will see who has the 'madness' in a few years time.
By then you will be in no doubt as to how bad things are.

I think going back to 1998 values might be taking it a bit far but I have no doubt that we are in for one very, very serious economic slump. And the best part of it is, despite all the information being out there for those willing to look and the mass media beginning to drip feed it to the herd, the general public are still as clueless as ever as to what is about to befall them. I keep thinking of the mental image of a flock of sheep plodding towards the slaughterhouse.

rozzy_2

Whilst it is obvious that the house prices are falling, I think the so called "crash" wouldnt be half as bad if it wasnt in the media on a daily basis. With all the media coverage about falling house prices it is inevitable that people particulary FTB's will hold out in order to get a much cheaper property. The longer people hold out the lower the house prices will get.

Just look at the Northern Rock situation, that wouldnt have been no where near as bad without the Media Coverage. I think the same applies to a housing market crash, without the media sure things would get a bit tighter, prices would fluctuate according to supply and demand but surely we wouldnt be fearing a 50% fall in prices.

LisbonLaura

rozzy wrote: »

Whilst it is obvious that the house prices are falling, I think the so called "crash" wouldnt be half as bad if it wasnt in the media on a daily basis. With all the media coverage about falling house prices it is inevitable that people particulary FTB's will hold out in order to get a much cheaper property. The longer people hold out the lower the house prices will get.

Just look at the Northern Rock situation, that wouldnt have been no where near as bad without the Media Coverage. I think the same applies to a housing market crash, without the media sure things would get a bit tighter, prices would fluctuate according to supply and demand but surely we wouldnt be fearing a 50% fall in prices.

I can hardly believe what you have typed!

I think you will find the media well behind the curve.

Did you 'fear' the 300% loon rise in values? - Somehow I don't think so. Though you should have noted that there was nothing to back it up other than a credit binge like no other.

The 'crash' as you call it, is merely a correction to sanity.

The real drama happening soon will make house prices a mere & very minor fixation.

rozzy_2

Yes I did fear the rise in house prices as it was getting increasingly more difficult to buy a reasonable property as a FTB which was affordable.

I also agree that the credit binge was ridiculous and banks should never have had let this happen. It was obvious that when the banks want their money back things would go pear shaped. Obviously the poor lending criteria that banks had on mortgages and other credit was poor management but IMO the Media has a part to play in it too.

Was it not the Media that portrayed what a good investment a property was? Would we have had so many BTL'ers without the media portraying how good it is to have a second income and also use the property market as a retirement plan.

Surely this has a part to play in the rise of house prices? as like anything prices can only work on supply and demand?

chrisandanne

A bit of anecdotal..I just have to tell someone this..My husband bumped into an old friend (46 year old policeman) he said he would be glad to get out of the force at 50, OH said well you'll be o.k, house paid for etc..... 'you must be joking we owe £160k' he said :eek: This is a house bought 20 years ago, three bed semi for about £40k or so. How many more are in this position ?.

I was gobsmacked. A x

donkeyman18

rozzy wrote: »

Whilst it is obvious that the house prices are falling, I think the so called "crash" wouldnt be half as bad if it wasnt in the media on a daily basis. With all the media coverage about falling house prices it is inevitable that people particulary FTB's will hold out in order to get a much cheaper property. The longer people hold out the lower the house prices will get.

Just look at the Northern Rock situation, that wouldnt have been no where near as bad without the Media Coverage. I think the same applies to a housing market crash, without the media sure things would get a bit tighter, prices would fluctuate according to supply and demand but surely we wouldnt be fearing a 50% fall in prices.

There's drivel, there's uber-drivel written on this site, and then there's the above statement.:rotfl:

dannyboycey

LisbonLaura wrote: »

Find the 1998 value because soon that will be the mark. It's called sanity...However it only applies providing the recession doesn't become a depression.
If it does, go lower still.
Will the vendor accept either? - of course not.
Do you want to pay far more than it will be worth in a few years? - I doubt it.

Finally, someone who talks sense. Quite a rarity on these forums. To be honest, I think I've had my fill of arguing with those who just 'don't get it' (that's not how I'd really phrase it, but I'm trying my best to be polite!). Perhaps it's time to take an indefinite break form posting here.

LisbonLaura

rozzy wrote: »

as like anything prices can only work on supply and demand?

You forgot lies, massive vested interest, greed, scams like MBS, SIV, CDO, & just about anything else that is vile when it's wearing a suit.............. but yes the media did talk up the market.....& the media were mostly still talking up it (&, they hoped, their portfolios) until very recently.
Now there is no point.
The experience of a lifetime has started.

lamy2503

rozzy wrote: »

Whilst it is obvious that the house prices are falling, I think the so called "crash" wouldnt be half as bad if it wasnt in the media on a daily basis. With all the media coverage about falling house prices it is inevitable that people particulary FTB's will hold out in order to get a much cheaper property. The longer people hold out the lower the house prices will get.

Just look at the Northern Rock situation, that wouldnt have been no where near as bad without the Media Coverage. I think the same applies to a housing market crash, without the media sure things would get a bit tighter, prices would fluctuate according to supply and demand but surely we wouldnt be fearing a 50% fall in prices.

Correct; if the media continued to ramp property prices with endless property p0rn then the "crash" wouldn't be half as bad - because we'd be well and truly stuck in the "denial" phase of the cycle. Vendors and purchasers would be willing to pay stupid prices but the banks STILL WOULDN'T BE LENDING 5x salary mortgages and anything above 95% LTV.

Correct; if the media had kept schtum about NR then there would have been no run - instead what we'd see is exactly what's happening to Bradford and Bingley right now. In other words, the silent run that for NR began on August 9th would have continued until the inevitable happened anyway.

Correct; prices will fluctuate with supply and demand. That is, the supply and demand of the credit we require to purchase property. The falls we've seen to date are almost entirely down to a contraction in supply of credit, once this mess is over and done with the demand shift (for credit) and the new equilibrium could leave those "fearing falls of 50%" as being overly optimistic.

You seem to have almost hit the nail on the head, without realising that we, the people, do not set house prices. The money lenders set house prices, they're currently being severely burnt by their greed - this will reverse, those that survive will rebuild with typical LTVs around 80% and mortgage interest rates of 8%+. It doesn't take a genius to realise that for property to shift in the new climate prices will have to significantly lower.