only anecdotal but USEFUL

carolt

The City agrees that price falls are a one-way bet:

http://www.ft.com/cms/s/0/11a2548c-9ba6-11dc-8aad-0000779fd2ac.html?nclick_check=1

City bets on 7% fall in house prices

By David Oakley and Chris Giles
Published: November 25 2007 22:38 | Last updated: November 25 2007 22:38

The City is betting on UK house prices falling by 7 per cent next year in new tradeable derivatives contracts, which some bankers say is the best indicator of the market’s direction as millions of pounds are riding on the outcome.

These future housing contracts, which were published for the first time this year and have seen a surge in trading volumes in the past few months, are predicting much bigger falls in property values than other non-tradeable forecasts.

seven-day-weekend

I'm so glad I'm out of the Matrix.

I don't understand a lot of this, but what a worry it must be for people who are simply trying to buy a home.

pamaris

What seems strange is that everyone and their dog knows what is going on except for sellers. They can't sell and can't figure out why. Even if a few would put two and two together and realise that if they cut the price on the property they are selling, they can pass that on up the chain by offering less... this whole thing might get going. The thing is, all I hear is "prices drop by .2%" Yay, big whoop. We personally need either a 25% drop or a 50% increase in wages in order to reasonably purchase a modest home.

I suspect that this thing will pick up momentum in summer 2008 but we won't actually be in a position of affordability till sometime in 2009. Either way I think we will start making "cheeky" offers and driving a hard bargain in summer 2008.

The whole thing really does get me down sometimes.

carolt

Yes, people wishing for 50% drops overnight are going to be disappointed - expect the whole thing to deflate gradually over a number of years. People don't willingly sell at a huge loss - for those at the top of chains, with plenty of equity built up, there is nothing to be gained for selling for less, unlike those lower down the chain. So increasingly, expect them to hang on for higher prices or just not sell.

At the moment, enjoy small falls if you're hoping to buy longer term. No hurry - enjoy your landlord subsidizing your rent in the meantime....

pamaris

carolt wrote: »

At the moment, enjoy small falls if you're hoping to buy longer term. No hurry - enjoy your landlord subsidizing your rent in the meantime....

No, living with mum in law... so, saving lots each month but itching to get out of here!

Zebedee69

pamaris wrote: »

No, living with mum in law... so, saving lots each month but itching to get out of here!

Oooooooooooooo! How do you do that? (Living with mam in law) I couldnt!

pamaris

Zebedee69 wrote: »

Oooooooooooooo! How do you do that? (Living with mam in law) I couldnt!

It is a combination of sheer determination, patience and keeping my mouth shut! It is all wearing a bit thin at the moment though.

carpetbelly

pamaris wrote: »

It is a combination of sheer determination, patience and keeping my mouth shut! It is all wearing a bit thin at the moment though.

Here, have a virtual beer! :beer:

movilogo

The EAs (and sellers) firmly believes that following expected rate cut soon, things will again go back to normal (ie. house price that can only go up)

SickStu

Generali wrote: »

True although consumers in Asia are starting to spend their incomes. It is possible that could make the difference (there are 2 billion people in India + China ~7x the population of the US). That's not the same thing as saying that they will make the difference.

I'm a bit sceptical about decoupling, I must admit. But there are a lot of people out there who are a lot cleverer than me who believe in it.

I think the India, China effect is way overstated. There may be 2 billion of them but sadly ~1.99 billion of them don't have the proverbial pot to !!!! in.