Nationwide flatlining.... -0.1 MOM

moneysavinmonkey

lol! probably not. never heard of the property cycle

adr0ck

moneysavinmonkey wrote: »

lol! probably not. never heard of the property cycle

is that the 18 year property cycle?

my heads in the sand and that cycle doesnt exist

thing is with those cycles....ride them out (from the bottom of the cycle) for 4 years and the price of your house will have gone from a high to a low to a high again (when the next cycle starts again)

dannyboycey

adr0ck wrote: »

ride them out (from the bottom of the cycle) for 4 years and the price of your house will have gone from a high to a low to a high again (when the next cycle starts again)

4 year cycle? Are they in the Argos catalogue, because I've never heard of them.

moneysavinmonkey

adr0ck wrote: »

is that the 18 year property cycle?

my heads in the sand and that cycle doesnt exist

that's the one... we've just had ten years of up.. guess what comes next?

adr0ck wrote: »

thing is with those cycles....ride them out (from the bottom of the cycle) for 4 years and the price of your house will have gone from a high to a low to a high again (when the next cycle starts again)

This makes no sense! from the bottom of a cycle prices do not go high to low they?? what has 4 years got to do with it?

Yes if you ride out the property cycle, it starts again! That's the whole point.

The key is timing your entry + exit well. Of course a house is a home so there are far more considerations than just that one thing, but given that it the most expensive thing you'll ever buy in your entire life (unless you really like yachts or something) it's a good idea to wait if you can whilst prices are falling, rather than buy when prices are coming off a 10 year bull run! Just good moneysaving!

adr0ck

dannyboycey wrote: »

4 year cycle? Are they in the Argos catalogue, because I've never heard of them.

18 year cycle

read the whole post and the couple before it

adr0ck

moneysavinmonkey wrote: »

This makes no sense! from the bottom of a cycle prices do not go high to low they?? what has 4 years got to do with it?

Yes if you ride out the property cycle, it starts again! That's the whole point.

yeah sorry wasn't very clear

what i meant was we seem to be going into the bottom end of the property cycle now (started approx 6 months ago)...so assuming we have approx 4 years of negative growth...................if you can hang on for 4 more years (is this about right?) your house will start to go up in value again...and will eventually be worth more than the high point of the last cycle

moneysavinmonkey

I'm still not sure I'm entirely with you...

We're really just coming off the top of the property cycle, prices have only been falling for about 3-4 months I think. Nobody really know how long they will continue to fall and how long they will take to recover.

I would guess that we would be in for at least four years of falls (loving your phrase 'negative growth' btw!) before things start to slowly recover.
If we're going with the 18 year theory and we agree we've just come off the top then, it will be another 18 years from now until we get to the top of the next cycle

When prices do recover there is no guarantee that they will regain the highs of the last cycle. Historically that is what usually happens, but then house prices never got sooo carried away as they just did (due to the explosion of credit and dodgy mortgages mainly i think) If I was a betting sort I would guess that next time around the banks will have learnt (or at least the government will) and they won't be allowed to lend so recklessly... so we may not get back quite up to where we are now. Sobering thought.

adr0ck

it doesnt take 18 years to reach the top

the 18 year cycle includes minimum of 10 years growth

see below for average uk prices when we went into last downturn


1985 31,103
1990 59,785
1991 62,455
1992 60,821
1993 61,223
1994 64,755
1995 65,641
1996 70,534
we had 2 -3 years of lower prices from the highpoint and then prices were higher (than the last highpoint)

dannyboycey

adr0ck wrote: »

we had 2 -3 years of lower prices from the highpoint and then prices were higher (than the last highpoint)

I 'think' I know what your trying to say. However, average prices are not the best indicator for showing what happened in the early 90's as they are so easily skewed. We know for example, that many thousands of people had to wait a decade or more before coming out of negative equity. Suggesting that it wouldn't really matter if prices crashed, because all would be rosy again in 4 years time is a rather simplistic viewpoint to take.

moneysavinmonkey

adr0ck wrote: »

it doesnt take 18 years to reach the top

the 18 year cycle includes minimum of 10 years growth

if the cycle is 18 years it takes 18 years to go from the top down to the bottom and back up to the top.

I think we are agreed that we only just left the top 3-4 months ago so it's going to take 17 years to reach the next 'top'

What I think you are saying is that assuming that the next top is higher than the top we have just left, then we won't need the full cycle to get back to where we are, maybe only a couple of years of growth again will make up all the losses.

I think that's very optimistic, certainly not possible in a 4 year time frame and as I said earlier, I'm even doubting that the next top will match this one.

I'm discounting general inflation.