House Price Crash Discussion Thread

TTMCMschine

I wouldn't worry too much about your age. I bought my first house when I was 27, lived in it for about 5 years, sold it (for a profit) once the first baby arrived & it wasn't big enough anymore, & have rented since. I'm 37 now & am waiting until I feel its the right time to buy, hopefully within the next 18 months.

Difference is that I now have a lot of cash thanks to the profit I made & some good investments, so I'll hopefully end up with no mortgage or a very small one when I do buy.

It can pay to think more about the long term & bide your time.

brit1234

Renting for 6 months is a good idea. After that it will be clear to see where the market is heading.

Personally I believe it will tank bigger than expected. My reasons for this are the vulnerabilities of the buy to let market ie seems sound when prices are on the up but falls apart when prices fall. Secondly is the media, back in 1989 people weren't using the internet, there were no business or 24 hour news tv channels. I believe because of this it will speed up the crash due to the mass reporting after the tipping point.

merlinthehappypig

brit1234 wrote: »

Renting for 6 months is a good idea. After that it will be clear to see where the market is heading.

Personally I believe it will tank bigger than expected. My reasons for this are the vulnerabilities of the buy to let market ie seems sound when prices are on the up but falls apart when prices fall. Secondly is the media, back in 1989 people weren't using the internet, there were no business or 24 hour news tv channels. I believe because of this it will speed up the crash due to the mass reporting after the tipping point.

Personally, I'm still not sure what will happen with prices. All the signs are there that there will be big reductions, but I wouldn't underestimate the Goverment's capacity for stupidity. I can easily see them taking steps to prevent big price reductions so the vast majority of people still carry on thinking that they are rich. Cutting the BOE interest rate when inflation is increasing is a sure sign that they have lost the plot.

I do agree with your point about the media, though. There is little doubt that the media had a key role in the Northern Rock scaremongering and that the problems would not have been so severe without the panic created by irresponsible and poorly informed reporting.

The vast majority of people believe what they see and hear in the media and if the media tells them that prices are going to crash, you can bet that they will.

Turnbull2000

BBC Business News. Surprised that the Council of Mortgage Lenders aren't on there dismissing current events as a 'seasonal hiccup'.

On a personal note, went to renew my Metro travel pass today. Up 10%. :mad:

WTF?_2

merlinthehappypig wrote: »

I do agree with your point about the media, though. There is little doubt that the media had a key role in the Northern Rock scaremongering and that the problems would not have been so severe without the panic created by irresponsible and poorly informed reporting.

The vast majority of people believe what they see and hear in the media and if the media tells them that prices are going to crash, you can bet that they will.

No, Northern Rock had a key role in the debacle surrounding them. They proceeded with an ill thought-out business plan that left them non-viable and in need of a government/BoE bailout (and the lax government regulators allowed them to get away with it).

If the media actually focussed on the whopping economic mess that we are really in and educated the public instead of spending time on 'celebrity news' and sports stories to keep their minds of the masses off of anything vaguely weighty or intellectual, we would see a rather greater backlash from the public than just a run on a single, failed, bank.

merlinthehappypig

!!!!!!? wrote: »

No, Northern Rock had a key role in the debacle surrounding them. They proceeded with an ill thought-out business plan that left them non-viable and in need of a government/BoE bailout (and the lax government regulators allowed them to get away with it).

If the media actually focussed on the whopping economic mess that we are really in and educated the public instead of spending time on 'celebrity news' and sports stories to keep their minds of the masses off of anything vaguely weighty or intellectual, we would see a rather greater backlash from the public than just a run on a single, failed, bank.

I probably didn't word my post properly.

I agree with you that Northern Rock played a major part in their own downfall. The business plan was poor and high-risk, making no allowances for changing market conditions.

What I meant to say was that they would almost certainly have got away with it without the media reporting. Given time, Northern Rock might have been able to mitigate some of the problems, but the media frenzy gave them no time. Whether they actually deserved any time is a matter for another discussion.

I also agree about the need for well-informed media reporting about economic and other political factors. The bottom line is that, even when the media do try and present a factual report on economics, it's (nearly) always biased to one viewpoint and often so factually incorrect I feel like banging my head on a wall.

Even Working Lunch, which is usually reliable has come up with some howlers lately.

Do the majority of people actually want to know how bad things are? My guess is that they would rather bury their heads in the sand.

You only have to look at the viewing figures for these awful reality shows to see what a nation of intellectual lightweights we have become.

Most people are happy to buy things that they don't need, with money that they don't have, turning a blind eye to the reality of paying the money back. Why would it be any different with their futures?

WTF?_2

merlinthehappypig wrote: »

I probably didn't word my post properly.

I agree with you that Northern Rock played a major part in their own downfall. The business plan was poor and high-risk, making no allowances for changing market conditions.

What I meant to say was that they would almost certainly have got away with it without the media reporting. Given time, Northern Rock might have been able to mitigate some of the problems, but the media frenzy gave them no time. Whether they actually deserved any time is a matter for another discussion.

I also agree about the need for well-informed media reporting about economic and other political factors. The bottom line is that, even when the media do try and present a factual report on economics, it's (nearly) always biased to one viewpoint and often so factually incorrect I feel like banging my head on a wall.

Even Working Lunch, which is usually reliable has come up with some howlers lately.

Do the majority of people actually want to know how bad things are? My guess is that they would rather bury their heads in the sand.

You only have to look at the viewing figures for these awful reality shows to see what a nation of intellectual lightweights we have become.

Most people are happy to buy things that they don't need, with money that they don't have, turning a blind eye to the reality of paying the money back. Why would it be any different with their futures?

There wouldn't have been a run when there was, if the media hadn't got wind of the BoE loans and informed the public - which is their job. The making of the loans are a matter of public record as the BoE isn't allowed to be secretive about handing out massive amounts of 'public' cash. However, NR's business model was just plain unviable and the merde would have hit the fan, spectacularly, at some point.

Certainly there are plenty of other British banks who are taking major loans from the European Central Bank right now, loans which are secret/confidential. Chances are if the full truth was known about a certain huge British bank beginning with 'B' the public would have something to say with their wallets as well.


If the public don't want to know how bad things really are then they can keep going out and buying plasma TVs and designer shoes on their credit cards, then sticking the bills unopened in the drawer. However, they should at least be informed so that they can make decisions about their finances. Just as we've seen a total media turnaround on house prices (when it's too late to be of any use to the public) we'll see a shift towards telling us just how deep we are in the doodoo when it's too late for anyone to make use of the information.

simon109

Thanks for the replies,

I guess we (I) am buying now as I'm 30 and worried if I leave it any longer I will never get on the ladder. Me and my gf have never lived together not even rented our own place, I worried that if we buy now and find out we can't live together in 6 months time and we have to sell and house and prices have fallen then we will be in a very bad situation trying to sell our house for less than we bought it for :eek:

I think it would be wise for us to rent for 6 months to see how the house prices go and if we like living together, if we don't we just go home and have only lost a few months renting money.

Simon.

If I did go ahead with the purchase and say completed in Feb but then had to sell in 3 - 6 months is it almost certain I would make a loss

Simon.

m00m00

simon109 wrote: »

If I did go ahead with the purchase and say completed in Feb but then had to sell in 3 - 6 months is it almost certain I would make a loss

Simon.

yes, without a shadow of a doubt

once you have factored in all the costs associated with buying a property, such as legal costs, mortgage fees, stamp duty

and the costs associated with selling

legal costs, estate agents fees etc

unless your property has gone up by about 5k you will lose money in such a short time span.

useless

Most people are happy to buy things that they don't need, with money that they don't have, turning a blind eye to the reality of paying the money back. Why would it be any different with their futures?

If the public don't want to know how bad things really are then they can keep going out and buying plasma TVs and designer shoes on their credit cards, then sticking the bills unopened in the drawer.

these comments makes me laugh. "most people".