30% fall in property if no deal brexit

triathlon

DannyGold wrote: »

Or you will be so disappointed with no deal and the start of a very long slow decline in house prices and slip into a long overdue deep recession......

I first heard that very same statement in the late 1990's and have heard it a thousand times since. Good luck with your prayer.

The-Joker

triathlon wrote: »

I first heard that very same statement in the late 1990's and have heard it a thousand times since. Good luck with your prayer.

I first heard from the perma property bulls in recent times, good luck with that

In the real world the decline in property has started and time will tell how long it goes on and where the bottom will be

But just for the record the perma property bulls are already wrong

phillw

The-Joker wrote: »

In the real world the decline in property has started and time will tell how long it goes on and where the bottom will be

But just for the record the perma property bulls are already wrong

How are they already wrong? Nobody has ever said that property can't drop in value, just that it recovers in the medium to long term if not the short to medium term.

Brexit will probably make a difference, but any gain from waiting will probably be wiped out by a few years rent. So very few people are likely to benefit.

I regret waiting as long as I did, my house would have paid for itself already.

triathlon

The-Joker wrote: »

I first heard from the perma property bulls in recent times, good luck with that

In the real world the decline in property has started and time will tell how long it goes on and where the bottom will be

But just for the record the perma property bulls are already wrong

"perma bulls" ???

DannyGold

Sorry perma prop bulls but negotiations have pretty much fallen apart, it’s looking increasingly like no deal which means a long slow decline in the property markets

DannyGold

triathlon wrote: »

"perma bulls" ???

There are many perma prop bulls on here who like to ignore anything remotely bearish on property values.

Don’t you know property just goes up more than everything else, way more than inflation forever, there will never be another correction in property ever again and sometime it’s will get to a point where nobody will ever be able to afford a property :rotfl::rotfl::rotfl::rotfl::rotfl:

triathlon

DannyGold wrote: »

There are many perma prop bulls on here who like to ignore anything remotely bearish on property values.

Don’t you know property just goes up more than everything else, way more than inflation forever, there will never be another correction in property ever again and sometime it’s will get to a point where nobody will ever be able to afford a property :rotfl::rotfl::rotfl::rotfl::rotfl:

I don't know one person on here like that, can you name them?
I tell you one thing though, many posters have said the house price doom cult were mostly wrong with their predictions throughout the 2000's and guess what? we were right.
I was a little concerned, though prepared after the 2007 financial crisis where I then predicted sizable drops in prices which the then never turned out all that bad, hardly noticeable in my area,

MobileSaver

DannyGold wrote: »

Or ... the start of a very long slow decline in house prices

How does that help anyone? Crashy Time and Diocletian will be drawing their pension before we reach the bottom so when they finally have the courage to buy it will be far too late.

DannyGold wrote: »

There are many perma prop bulls on here who like to ignore anything remotely bearish on property values.

You claim there are "many perma prop bulls" and yet despite being repeatedly asked to name them you never do. It really is getting embarrassing for you now.

vacheron

Here are some quick calculations I have just worked out.

I am using what I considering are realistic real world figures here for the average buyer / renter, but feel free to substitute your own if you disagree.

• House value £250K
• Mortgage needed £200k (80% LTV, 25 year @ 3.00%)
• Savings interest rate 1.5%
• Calculations are after 10 years,
• No house price (or rent) rises are assumed.

Red=Costs, Blue=returns (equity or cash)

Buyer costs:
Monthly mortgage payment on £200k, 25yrs, 3.00%: £948.00
Deposit 50K (20%) (moved from cash to equity)
Interest charged over 10 years: £51.1K
Capital repaid over 10 years: £62.7K
Total equity at year 10 = Deposit + Capital Repaid - Interest Charged = 61.5K

Renter costs:
Monthly rental payment on £250K house: £900pm
Deposit (retained in cash): 50K
Interest on the £50K deposit compounded over 10 years: £8.1K
The £48pm saving (£948 mortgage - £900 rent equivalent)deposited over 10 years: £5.8K
Interest compounded on the above £0.5K
Total cash savings after 10 years = 64.3K
Total paid in rent over 10 years: £108,000
Total equity ofter 10 years (cash savings - rent charged): -43.7K

So, by my calculations, after 10 years (assuming no property value or rent inflation whatsoever), a buyer of a £250K property would be £105.2K better off by buying as opposed to renting.

This means that after 10 years, the property crash (armageddon, brexit or whatever) would have to be at least 42% just for a 10 year renter to even break even. Or, to put it another way, 12% larger than the 30% drop discussed in the title of this thread!

If however, you are renting your £250,000 property for less than £25 per month, you will indeed break even!

Discuss:

epinjy

vacheron wrote: »

Discuss:

It's known as 'imputed rent', and is what makes up the majority of the 'returns' on home ownership. The obsession/fixation on the single figure of a house price is more or less a meaningless distraction.