House Price Crash Discussion Thread

DreamBreaker

HammersFan

I think we are managing to make this forum more objective. I just hope more people are not scared to voice their opinions now. Unfortunately for us the only people who will ever be interested in this forum are those who are searching the internet for a glimmer of hope that property prices will fall and they will be able to buy. Hence the lack of people on this forum with our point of view, most of them are tucked up in the beds they own, in the house they own, in the comfort of knowing they have made the right decision in buying the roof over their heads.

DreamBreaker

What on earth is going on with the quoting on here? I quoted biggie but my name is in there?

Turnbull2000

They are not hoping for price falls for anyone's benefit except their own. The fact is ignored that price falls tend to be associated with a wider economic malaise that helps no-one.

And how is that any different from those who hoped prices would continue to rise? High prices are both damaging and unsustainable. The economic malaise is already here, and if it weren't for this property bubble - we possibly would have escaped the mess we're currently in.

If I want to ease the way for my kids when they come to buy a house, I put money aside for them now. And as soon as I can I will get a BTL that they can have when they reach 21 (thereby locking it in at today's prices). I know I must be a mug, everything is so ludicrously over-valued and will be tonnes cheaper in 15 years (that's irony by the way).

Good luck. But not every family is in a position to do so. I think that's a good example of the divisive society this bubble has created.

Since when have we had 20% YOY rises across the UK? Since 2005, in many parts of the UK growth has been 5-6% per year (a little more than 3% in real terms - if you take out figures for Scotland, NI and London). I don't really see this a problem - and London aside , the biggest growth has been in areas that were under-valued (e.g. NI).

http://news.bbc.co.uk/1/hi/business/3542152.stm

"The average house price rose 17% to £175,401 in the April to June period, compared with a year earlier. The biggest price increases were seen in the north of England and Wales, where values jumped by more than 25%."

http://news.bbc.co.uk/1/hi/business/3542152.stm

"Britain's biggest building society says house prices soared in June at an annual rate of nearly 20%, the highest rise for 13 years."

Those not buying..... are not buying because of the choices they make. I don't earn loads of money, but having a house that I own one day is important to me. There is always a way to get property if you want it badly enough - I don't think blaming others or some economic conspiracy is at all helpful.

Is that the choice of then they were born? And badly enough as those who sought sub-prime mortgages both over here and in the States? Other than waiting for the market to correct itself, I think "sometimes" would be more appropriate than "always",

A global credit crunch, an asset bubble, sub-prime crisis, interbank rate detached from BOE, debt greater than GDP. That's one helluva conspiracy!

nelly_2

Turnbull2000 wrote: »

If you're sensitive enough to view that as an "attack", I suggest you refrain from using the internet and use your PC for solitaire only.

Good shot squire

DreamBreaker

nelly wrote: »

Good shot squire

Childish to say the least!

DreamBreaker

hey the doommongers have jumped ship they have started a new forum http://forums.moneysavingexpert.com/showthread.html?t=633141

"Property Price Crash - Accelerating"

Bless um!

Wonder if the forum admins will stop that forum as we are supposed to only have one thread on House Price Crash Issues, unfortunately i get the impression the admins "can't be bothered" most of the time!

HammersFan

Turnbull2000 wrote: »

And how is that any different from those who hoped prices would continue to rise? High prices are both damaging and unsustainable. The economic malaise is already here, and if it weren't for this property bubble - we possibly would have escaped the mess we're currently in.

Good luck. But not every family is in a position to do so. I think that's a good example of the divisive society this bubble has created.

http://news.bbc.co.uk/1/hi/business/3542152.stm

"The average house price rose 17% to £175,401 in the April to June period, compared with a year earlier. The biggest price increases were seen in the north of England and Wales, where values jumped by more than 25%."

http://news.bbc.co.uk/1/hi/business/3542152.stm

"Britain's biggest building society says house prices soared in June at an annual rate of nearly 20%, the highest rise for 13 years."

Is that the choice of then they were born? And badly enough as those who sought sub-prime mortgages both over here and in the States? Other than waiting for the market to correct itself, I think "sometimes" would be more appropriate than "always",

A global credit crunch, an asset bubble, sub-prime crisis, interbank rate detached from BOE, debt greater than GDP. That's one helluva conspiracy!

The links you posted refer to 2004. A little out of date I feel and not exactly 20% across the board was it? Have you considered that the 'boom' of 2000 to 2004 was because houses were under-valued still?

Excatly what mess are we in? Employment is at a record high. Interest rates very reasonable and inflation, at worst, 3-4%. even the stockmarket is pretty solid. If we were in a mess I'd concede your point. I guess we might be in a mess at some point in the future. But to say we are in one, when we aren't is just wrong.

I guess you will quote some survey or other back at me....but my parents saved until they were in their 60's to buy a house for cash. They now enjoy a very comfortable retirement as a result. They never gave up. They never whinged about prices, they just got on with it. My point is that whatever the situation you can do something about it. I would litterally shovel !!!!!! if I had to give my family the security of a house they own. I would imagine a fair proportion of people who moan about house prices slacked off at school, chug a load of beer every night, smoke their way through a fortune etc. etc., they made a choice that house ownership was / isnt more important than other things. I will lawys remain of the view that nothing is impossible if you want it enough.

You can still get houses in the UK at 80k. Less sometimes. And mortgage interest is close to rental figures in a lot of cases (hence the doomongers on here telling BTL'er what fools they are, thus missing the point that prices will be way beyond today's figures in 20 years). Why not buy if this is the case?

HammersFan

DreamBreaker wrote: »

HammersFan

I think we are managing to make this forum more objective. I just hope more people are not scared to voice their opinions now. Unfortunately for us the only people who will ever be interested in this forum are those who are searching the internet for a glimmer of hope that property prices will fall and they will be able to buy. Hence the lack of people on this forum with our point of view, most of them are tucked up in the beds they own, in the house they own, in the comfort of knowing they have made the right decision in buying the roof over their heads.

Thanks. Its the defeatest attitude, scaremongering, and criticism of others' choices that rankles with me. Its like people are being painted as villians because they bought a house. And worse, as insane to buy one now. I think that needs challenging. Imagine a first time buyer coming into this forum !!! They would think the world was coming to an end.

DreamBreaker

HammersFan wrote: »

The links you posted refer to 2004. A little out of date I feel and not exactly 20% across the board was it? Have you considered that the 'boom' of 2000 to 2004 was because houses were under-valued still?

Excatly what mess are we in? Employment is at a record high. Interest rates very reasonable and inflation, at worst, 3-4%. even the stockmarket is pretty solid. If we were in a mess I'd concede your point. I guess we might be in a mess at some point in the future. But to say we are in one, when we aren't is just wrong.

I guess you will quote some survey or other back at me....but my parents saved until they were in their 60's to buy a house for cash. They now enjoy a very comfortable retirement as a result. They never gave up. They never whinged about prices, they just got on with it. My point is that whatever the situation you can do something about it. I would litterally shovel !!!!!! if I had to give my family the security of a house they own. I would imagine a fair proportion of people who moan about house prices slacked off at school, chug a load of beer every night, smoke their way through a fortune etc. etc., they made a choice that house ownership was / isnt more important than other things. I will lawys remain of the view that nothing is impossible if you want it enough.

You can still get houses in the UK at 80k. Less sometimes. And mortgage interest is close to rental figures in a lot of cases (hence the doomongers on here telling BTL'er what fools they are, thus missing the point that prices will be way beyond today's figures in 20 years). Why not buy if this is the case?

Abolutely SPOT ON!! Wanted to say many of those things myself!

The problem many first time buyers have now is "too high expectations".

There are houses for 80k and less but FTB don't want them, they want the best straight away, not happy to just get a foot on the ladder.

I saved for my first home for a year, I didn't go out, I stopped smoking, I wore the same clothes day after day, all to save a deposit. My first house, was "ok", in an "ok" area, it was not ideal but I saw it as a stepping stone. If I had to do it all again now I would happily except a less than ideal house in a not so good area just to get my foot on the ladder. Many first time buyer's are not happy to settle for that, they want the best now. They are not prepared to save, to stop buying designer, to stop partying for a year, to stop buying all the mod cons like the new "iphone", to even forsake their mobile phone or skyTV, or playstation 3!

Like you say my parents did without soooooooooo much too, just to pay their mortgage. Many people and I stress not all want the best NOW and are not prepared to sacrifice to afford it. I must stress this is not a generalisation I know for some FTB's this is not the case, but I have friends and family who complain they can't get on the housing ladder because they cannot afford it, yet they are going out for meals twice a week, buying new outfits weekly, have a brand new car, a top of the range mobile, etc, etc!

And yes I agree if only they could see that if prices fall in the short term it will be insignificant to the long term financial gains to be had in owning a property as a family home or as an investment. BEER TO U! :beer:

Oh and the world probably has come to an end.........for some of the people on this forum who listened to the scare mongers all those years ago telling them the market would crash and hold out, they are probably very frightened that maybe they missed the boat.

Turnbull2000

"Doomongers". Yawn.

HammersFan wrote: »

The links you posted refer to 2004. A little out of date I feel and not exactly 20% across the board was it? Have you considered that the 'boom' of 2000 to 2004 was because houses were under-valued still?

Of course those individual articles are not across the board - regional variations meant than double digit inflation did not occur simultaneously.

Inflation adjusted prices from Nationwide indicate that prices started to become detached from historic trends somewhere between late 2001 / early 2002. Many regions experienced 20% plus inflation beyond that date - and so too did countries such as the US, Spain, Ireland and Australia.

Here's the UK statistics for yourself.

1975 Q1 69.6K
1976 Q1 62.9K
1977 Q1 58.1K
1978 Q1 59.3k
1979 Q1 69.7K
1980 Q1 74.4K
1981 Q1 69.1K
1982 Q1 63.4k
1983 Q1 65.7K
1984 Q1 70.5K
1985 Q1 74.8K
1986 Q1 76.5K
1987 Q1 84.4K
1988 Q1 90.1K
1989 Q1 110.4K
1990 Q1 102.5K
1991 Q1 86.4k
1992 Q1 79.4k
1993 Q1 74.9k
1994 Q1 74.9k
1995 Q1 72.1k
1996 Q1 70.5k
1997 Q1 74.6k
1998 Q1 81.3k
1999 Q1 85.4k
2000 Q1 96.1k
2001 Q1 101.3k
2001 Q4 110.3K
2002 Q1 113.6k
2003 Q1 138.7k
2004 Q1 158.1k
2005 Q1 166.9k
2006 Q1 171.1k
2007 Q1 179.2K
2007 Q3 184.1K

Almost all the major broadsheets are now admitting that a correction is long overdue. A repeat of the 2005 'bail-out' is highly unlikely due to external factors beyond the BOEs control.

HammersFan wrote: »

Excatly what mess are we in? Employment is at a record high. Interest rates very reasonable and inflation, at worst, 3-4%. even the stockmarket is pretty solid. If we were in a mess I'd concede your point. I guess we might be in a mess at some point in the future. But to say we are in one, when we aren't is just wrong.

Employment is high because EU immigration is uncontrolled and the public sector is bloated. GPD per head in all probability no higher. Too low interest rates have been damaging, and were initially a consequence of 9/11 in an attempt to stave off recession. Unfortunately, those that dictate economic policy became greedy and retained low rates in the impossible drive for perpetual economic growth and merely delayed the inevitable. All this created was a huge mountain of debt. Heck, we can no longer even afford an inflation matching pay-rise for our police force.

Official inflation figures are dubious to say the least. Google up some articles on 'CPI' and 'RPI' for numerous views. But even these massaged statistics will not hide the inflationary pressures that China, India and many other developing nations are about to exert.

HammersFan wrote: »

You can still get houses in the UK at 80k. Less sometimes. And mortgage interest is close to rental figures in a lot of cases (hence the doomongers on here telling BTL'er what fools they are, thus missing the point that prices will be way beyond today's figures in 20 years). Why not buy if this is the case?

That's still no real solution. Tens of thousands of priced-out FTB cannot just magically relocate to cheaper estates or regions. The market as a whole is too overvalued to allow enough 80K properties. A relocation to a cheaper region will also likely result in lower earnings.

Of course it's likely that property prices will be higher in 20 years. And so will everything else.