Can you imagine the destruction in the UK if the property market crashed

lisyloo

AG47 wrote: »

Property is not at all liquid, this is why the smart sellers are undercutting and lowering prices now because next few years will see much much lower prices

No they aren’t.
Landlords with great yields and great tenants will keep their good investments if it’s paying off. They didn’t get into it for short term speculation.

People enjoying living in their homes will continue to do so and because of high taxes and a difficult system will be minded to extend rather than move.

Transactions are low.

There might be a few landlords selling up but that’s more likely to be because of the increasing tax and law burden than short term speculation on the markets.

Hardly anyone takes a short term view of property.

andrewf75

Malthusian wrote: »

Thing is that it's not ridiculous for the reasons you state. Owning your own house is an incredibly attractive investment. Not just in £ terms; the vast majority of the population, who struggle with abstract concepts including the value of a portfolio of electronically held shares, fully appreciate the value of owning your own home. It gives peace of mind over retirement plans. It allows you to paint your walls neon green and own 20 cats if you feel like it. It is made even more attractive by the tax system.

If anything it is a wonder that, thanks to a developed financial system, the person in the street can reasonably hope to own this incredibly valuable asset, rather than the privilege being restricted to the rich as it used to be a few centuries ago.

By contrast, if house prices did not continually rise, home ownership would be unaffordable for most as the person in the street would not have enough money to sink vast amounts into a declining asset, while paying off a loan that would have the same APR as car loans.

Agree on an individual level, but on a societal level I think our culture of using housing as investment creates a big divide.

The-Joker

BREAKING NEWS: Knife crime in the UK INCREASES DRAMATICALLY.

17.4 MILLION voters STABBED IN THE BACK!

potatoefeet66

Unfortunately we have all to varying degrees all bought into a fiction that lenders treat us fairly and act in their customers interest. When the economy and along with it property crashes and I speak with regard to my mortgage provider I cannot tar all with same brush, it will it will be due to the dishonest and unfair practices, Life lesson number 1 honesty.

AG47

potatoefeet66 wrote: »

Unfortunately we have all to varying degrees all bought into a fiction that lenders treat us fairly and act in their customers interest. When the economy and along with it property crashes and I speak with regard to my mortgage provider I cannot tar all with same brush, it will it will be due to the dishonest and unfair practices, Life lesson number 1 honesty.

Last min attempts to prevent the HPC will be to lower lending standards but this just makes the crash worse longer term

potatoefeet66

I see what your saying and your not wrong. Hasn’t the FCA due to pressure from MSE just confirmed new affordability rules to prevent mortgage prisoners. In any scenario lenders need to be clear and honest.

Thrugelmir

potatoefeet66 wrote: »

I see what your saying and your not wrong. Hasn’t the FCA due to pressure from MSE just confirmed new affordability rules to prevent mortgage prisoners. In any scenario lenders need to be clear and honest.

Nope. Lenders can apply more lax criteria. Though are under no obligation to advance money.

There remains the question as to why people are still in the situation they are in. A decade on.

phillw

Thrugelmir wrote: »

There remains the question as to why people are still in the situation they are in. A decade on.

Because the mortgage affordability checks that were introduced were extreme and would likely have excluded them from getting a mortgage in the first place and the wage increases over the last ten years haven't been enough to get them out of it.

It's kinda weird that they use the argument you can't afford a cheaper fixed rate when you can afford their more expensive variable rate, just because you would struggle to pay if their more expensive variable rate doubled. Especially considering that we're at the cheapest lending ever.

lookstraightahead

I've owned and rented. Are people really so obsessed with bricks? That's the main problem in this country - it shouldn't be such a huge deal.

There's a lot of false wealth out there. People who by pure luck are sitting on what they think is a fortune. It doesn't rest easy with me because I'm not sure they realise it could be lost overnight.

I think house prices in general are ridiculous at the moment. I works lihecto see a correction.

chucknorris

lookstraightahead wrote: »

I've owned and rented. Are people really so obsessed with bricks? That's the main problem in this country - it shouldn't be such a huge deal.

There's a lot of false wealth out there. People who by pure luck are sitting on what they think is a fortune. It doesn't rest easy with me because I'm not sure they realise it could be lost overnight.

I think house prices in general are ridiculous at the moment. I works lihecto see a correction.

It isn't a 'huge deal', but you have to invest (or spend) your money somewhere, I simply invested in property because I thought that it would be give me the best return, and it did. For a while now I have thought that equities would be a much more suitable investment for my retirement than property, which is why I started investing in them much more about 10 years ago, and more recently started to sell off my properties. There isn't anything false about the profit that was released at the point of sale, if there was, perhaps you could point it out to the inland revenue, so that they can return the CGT that I paid.