House prices will recover this year

therealdelboy

Let's hope any drop doesn't last too long, once this credit crunch passes (and it will) then we should start to see some oomph come back into the market again

Commonsensesearcher

therealdelboy wrote: »

Let's hope any drop doesn't last too long, once this credit crunch passes (and it will) then we should start to see some oomph come back into the market again

And how is the 'Spring bounce' doing in the Estate Agency business??? Or should I say Estate Agency lack of business...?

Seems to be plenty of "oomph" in the market - just not in the way you would like!

steadysaver

therealdelboy wrote: »

Let's hope any drop doesn't last too long, once this credit crunch passes (and it will) then we should start to see some oomph come back into the market again

I don't know, once confidence takes a knock it can take a long time to come back. And who says the banks will start lending 4x,5x, 6x plus salary again. Once bitten, twice shy. And would the British people really stand for the government to bail them out again! Debatable.

Rick62

therealdelboy wrote: »

Let's hope any drop doesn't last too long, once this credit crunch passes (and it will) then we should start to see some oomph come back into the market again

Its not a credit squeeze, its a credit crunch. The same difference as having to drive slowly through a traffic jam versus having driven fast into a brick wall.

The credit cruch will not 'pass' it will take years of banks re-building their asset bases, sorting through all the reckless packaged mortgages of the last few years and slowly rebuilding mutual confidence.

Martinslovechild

Dan: wrote: »

BoE have factored this in as worst case scenario. Can't see more then 10% myself but you never know.

One committee which advises the treasury has priced in a 15% fall this year followed by 15% next year.

I continually find it odd how headlines suggest that the Bank of England should be lowering interest rates to shore up house prices - that's not their job! The BoE were tasked with ensuring that CPI inflation stays within 1% of a target of 2% (i.e. between 1% and 3%). And that's it - their one task.

CPI doesn't even take into account mortgages or house prices (as did the old measure of inflation, RPI), but it does include rental yields (although these have actually been reducing in real-terms over recent years as increasing numbers of new landlords have moved into the BTL market).

There have been various comments made in the press about how CPI is not really a very useful figure as it includes items such as DVD Players (which have been falling in price) but doesn't take into account professional services such as hairdressing or babysitting (which have been rising much faster than CPI would indicate).

It seems to me that Mervyn & his gang of merry bankers should be increasing Bank Rate - not reducing it. After all, CPI has been climbing and is set to rise further with oil now firmly above $115 a barrel and soft commodities such as wheat, grain & soya beans having doubled in price in just 12 months. But then, it wouldn't surprise me if Gordon was having a quiet word in Uncle Mervyn's ear asking him not to be too heavy on Joe Public - Gordon's 10p Income Tax band removal has already put paid to that...

MUDGUTS

Good to see that the BoE's intervention in the market is starting to take effect.

Yes my neighbours house (that is for sale), has gone up in price already; thats twice today, plus the price of a BMW 3 series has gone through the floor locally, that's actually GOOD news as all the local BTLers are chasing the lastest must have: a 5 series, such is the impact on the money markets and house prices today.

'...starting to take effect.' You must be on drugs

Gorgeous_George

There is also this snippet.

Assetz also expects buy-to-let activity to increase as the lack of first time buyers in the market creates rising rental demand and the opportunity for experienced landlords to pick up good deals on properties.

Clicky

I have one eye on a house (3 bedrooms and a garden) that has a tenant paying £425 per month and currently marketed at £75K. If I could get it for £50K the numbers will stack up for me and I'll buy it (making an offer if its asking price falls).

GG

nelly_2

therealdelboy wrote: »

Good to see that the BoE's intervention in the market is starting to take effect.

Although I think it might be wishful thinking to hope for a price recovery this year. I would have thought that prices would remain flat for the rest of the year, and would hope to see house price inflation pick up in the new year.

A good time to buy now - if only I had the cash !!

Look mate house prices arnt hardly gonna rise for the next TEN years never mind next year.

People cant afford them and banks cant afford to lend on them

MrSafeGaz

therealdelboy wrote: »

Let's hope any drop doesn't last too long, once this credit crunch passes (and it will) then we should start to see some oomph come back into the market again

Lets not.

Regardless of whether the 'credit crunch' ends in the near future or not it will take a significant amount of time for lenders to build up the confidence to start being a little more risky again. 100%+ LTV products are not just gonna start appearing the moment the credit crisis is over. If house prices remain the same and higher risk products and income multipliers are not available then less and less people are going to be able to buy.

Not to say that there will be a crash but I don't think that you will see any of your 'Oomph' in the near future.

ManAtHome

Well, you never know - £50bn a month and things may start to pick up around September, and you may be able to swap your house for a few Kg of rice...

Have noticed all btl-badger's one-liners have stated this is all about reducing mortgage rates - belated honesty (gasp!!), apparently the "re-balancing the economy" lie for lower-rates has finally been abandoned.