House Price Crash Discussion Thread

Sibley

As a result, I think the general housing market is going to be stagnant for the next decade at least, if not two. The only way to get the economy going again is through a massive innovation giving the UK a massive advantage and benefiting everyone. This is unlikely, as any life changing innovation, will need to be more sophisticated and complex than what is already out there as all the easy ideas have been done already. This means it will only benefit the talented people who make the discovery rather than the broader economy.

Thanks for reading and I welcome your thoughts.

I agree with you. People will never sell their house cheap. They don't need to. Even if prices were dropping it's still cheaper to stay out than to rent and we all know that eventually prices will rise. No brainer really.

anorthosite

Sibley wrote: »

I agree with you. People will never sell their house cheap.

Their banks might though.

harryhound

Yes there will be forced sellers - those that die, those in living death (bankruptcy) and those who have to sell because their falling incomes no longer cover their outgoings (pensioners with care needs trying to live on investments). As the housing turnover is now at a very low point, market prices can move quickly in a thin market.

AndyGuil

Those that need to sell will have to drop prices. Those that can wait can carry on without worry. Ultimately if you are selling you have to drop the price. When the house is valued it will be less than what it was a few months ago. If the house price is not dropped then it won't be sold. Nevermind that the buyer will want less, the bank won't give a mortgage out for an overpriced property. I think this year will be a big faller then stabilise around 2012 with only a small fall and then level around 2013. Whether it booms or is stable after this point who knows? Many governments in the past have said they don't want a house price boom, but it still happens. The market wants it to happen, but the sentiment is not so now and for atleast a couple of years until FTBs come back. 5 years I expect the market will be strong again and bottom out in around 2-3 years. London is due a correction too, but a lot of London is reducing it's prices with some areas going up and effectively propping the average value up. Certainly most properties aimed typically at FTBs in zone 2 and outwards are going down in value.

IveSeenTheLight

AndyGuil wrote: »

Those that need to sell will have to drop prices. ............................ Ultimately if you are selling you have to drop the price. .......................
If the house price is not dropped then it won't be sold

This is not what I've seen from the two friends of mine who recently sold / bought.
With regards to those that "have to sell". The number may be insignificant to affect the average prices.

AndyGuil wrote: »

When the house is valued it will be less than what it was a few months ago. . Nevermind that the buyer will want less, the bank won't give a mortgage out for an overpriced property. I think this year will be a big faller then stabilise around 2012 with only a small fall and then level around 2013.

We'll see if there is to be "a big faller" in 2012.
Personally, I think it will be another stagnant year

AndyGuil wrote: »

Certainly most properties aimed typically at FTBs in zone 2 and outwards are going down in value.

Have you got a link to back up this statement? It could be worthwhile for some

AndyGuil

IveSeenTheLight wrote: »

This is not what I've seen from the two friends of mine who recently sold / bought.
With regards to those that "have to sell". The number may be insignificant to affect the average prices.

I think it is more the lack of buyers particularly FTBs that is causing the biggest problem. When they have saved the deposits to get a house the markets will pickup again and there will be a steady stream of FTBs.

IveSeenTheLight wrote: »

We'll see if there is to be "a big faller" in 2012.
Personally, I think it will be another stagnant year

I hope it does stagnate, i think many are finding it stressful with the prices continually decreasing.

IveSeenTheLight wrote: »

Have you got a link to back up this statement? It could be worthwhile for some

I will need to do some searching, it is an observation.

padington

Sibley wrote: »

I agree with you. People will never sell their house cheap. They don't need to.

People do, when people die families need to sell the house to divy it up. Thats when the buyers get to call the shots. You cant hold out against the market forever.

IveSeenTheLight

padington wrote: »

People do, when people die families need to sell the house to divy it up. Thats when the buyers get to call the shots. You cant hold out against the market forever.

Not true.
When it comes to inheritance, the property can go on the market and is sold at the current market rate.
That of course is subject to the level of demand.

I bought my first property which was left in inheritance. I tried a cheeky offer which was rejected and had to pay the full asking price.
I had to accept as I had managed to get the offer in before it was fully marketed.
If I had delayed, the likelyhood would have been more interest and a higher purchase price

The_Drama_Llama

Reactor wrote: »

Therefore employment is the main factor that can cause a crash: if you're out of a job too long, you won't be able to pay the mortgage and you will be forced to sell or get repossessed.

As most of the heavy lay-offs have been done already,

Thanks for reading and I welcome your thoughts.

I'm not sure I agree about heavy lay-offs having happened already. Local Councils are about to start announcing how many people they are going to have to cut...some already have: Manchester this week announced 2,000 staff cuts. Most councils are looking at 17-25% cuts to their budgets, and the only way to achieve those is by cutting staff, at all levels and across all services. April is going to be carnage...I really feel for anyone working in the public sector, 2011 is not going to be fun.

And public sector cuts will have an inevitable knock-on effect for the private sector. The comapny I work for provides services to a number of arts institutions, which are already feeling the pinch, and likely to be even more tightly squeezed. If push comes to shove, we'll have to lay people off.

Not wishing to be the voice of doom and gloom, but I don't feel we're out of the woods yet regards a double dip.

padington

IveSeenTheLight wrote: »

I bought my first property which was left in inheritance. I tried a cheeky offer which was rejected and had to pay the full asking price.

How do you know the full asking price wasn't already discounted from what would have been offered in another circumstance ? We pulled our asking price down by 30k. It was a no brainer as family mortages could be paid off straight away and there was no risk of a further price drop and everyone could move on with little effort. Naturally we didn't move much on the price there on after as we had already taken a hit on the asking price.