BOE and a recession.

mi-key

TonyTeacake - I bet you £10 now we don't see drops of 50% in house prices anywhere in the UK within the next 6 months. While the UK has a massive shortage of housing, the market will always be held up by that. 

TonyTeacake

I will bet you £100.

You sound like an estate agent using the shortage of houses argument. The main reason over the last couple of years for this was they where more buyers than sellers which created an imbalance and this pushed prices up. Like I said before it was all created by covid with ultra low interest rates and cheap money.

It's game over pal, the boom is over and we are in a downturn  which we are going to see from now on and into the next 2-3 years.

I'm not sure of your situation but I personally think house prices going down is a good thing especially for the younger generations. This maybe something you don't like to hear because I suspect you have a vested interest.

Aberdeenangarse

mi-key said:

While the UK has a massive shortage of housing, the market will always be held up by that. 

No. Affordability is now the problem i.e. Lenders are restricting loans.

mi-key

TonyTeacake. No real vested interest, I have a £100K mortgage on a £300k house so plenty of equity, fixed for 10 years at 2% which will take me to the end of the mortgage.  I'm not looking to buy anywhere bigger ( I will be downsizing if anything, so dropping prices would be negligable for me ). 

mi-key

Aberdeenangarse said:

mi-key said:

While the UK has a massive shortage of housing, the market will always be held up by that. 

No. Affordability is now the problem i.e. Lenders are restricting loans.

Lenders only make money when they lend. If it starts hitting their bottom line they will make it easier to buy by some method. At the moment they have had a knee jerk reaction to the interest rate rises and raised mortgage rates by a lot more than they needed to.

Remember only a fairly small percentage of homeowners are on variable rates, or have a short term deal ending soon. Most are on longer fixes, so rate changes don't effect them. 

mi-key

House prices have risen at a steady rate for the past 13 years, it's not just the last couple of years 

Aberdeenangarse

mi-key said:

Aberdeenangarse said:

mi-key said:

While the UK has a massive shortage of housing, the market will always be held up by that. 

No. Affordability is now the problem i.e. Lenders are restricting loans.

Remember only a fairly small percentage of homeowners are on variable rates, or have a short term deal ending soon. Most are on longer fixes, so rate changes don't effect them. 

Really?

https://www.resolutionfoundation.org/publications/interesting-times/

https://www.theguardian.com/money/2022/oct/15/uk-families-mortgage-rising-resolution-foundation

mi-key

Aberdeenangarse Yes, says 20% 'could' be effected ( by the end of 2024 - and we dont know what is going to happen to rates over the next 14 months ).  80% - or the vast majority are not effected by it. I am really talking about people who will be directly effected over the next 6 months, which will be the critical time.

In any case, we will see what Mr Hunt says today, and if it has any calming effect on things 

brownbagsFTB

The rate changes will affect hundreds of thousands of people over the next couple of years unless the government can stabilise the markets. I think there will be a short term house price crash but certainly not drops of 50% in value. Most experts are saying 10-15% which really won’t affect most people drastically (unless they’re very recent FTB) as house prices have risen by that much in the last 12 months (mine’s gone up £20K after I bought so it really makes no odds if it drops by that). There is still crazy demand for housing. Lots of first time buyers waiting in the wings to snap up properties once they can get loans and I’m pretty sure the government will launch a FTB scheme to help them get on the ladder. Add to that the rental market’s getting a bit screwed as buy to let becomes a lot less affordable for LL and I think we’ll still have enough competition in the housing market to keep prices fairly stable. 

PK_London

I think a very small minority will be forced to sell but given the stickiness of prices and demand I dont think they will be forced to sell too low. There a re most outrightly owned properties in the UK than every before so a few distressed sales wont tank national prices. I would guess prices will fall between 5-10% in some areas - but in the most desirable areas prices may still rise.