Sell Your House Now Or Face 80% Falls, what is YOUR prediction?

neas

LillyJ wrote: »

Um I think you are rather mistaken there little Oliveru. Many baby girls have been murdered when they are the FIRST child as people want to have a boy. (culture). Many people cannot afford to have a girl and they cannot afford the fine for a second child so they keep killing girls until they get a boy.

Again, I don't need education, 6 years at uni and a PhD did that for me thanks. And as it was in public health I have a little knowledge about the old Chinese system and the effects on it's people.

Agree altho the policy is aimed to curb their explosive population (its population is highest i think). But in some asian cultures and traditions boys are seen as providing wealth.. they care for their parents when they are older because they dont have an nhs or pension scheme. Whereas girls get 'sold' or pawned off to live at home and generally not provide income.

So... boys are chosen from poorer familys ... this is why i believe they have a large proporton of new infant boys to females when it should be 105 females to 100 boys generally.

neas

dopester wrote: »

Gave you a thumbs up bandraboy cause in agreement with you, except it's huge deflation we are in for imo for bricks and mortar assets - with inflation for stuff like food.

Deflation - it's a concept that too many people can't get their heads around, and it's very painful, but better than hyper inflation which totally wrecks economies.

After being beaten back by the financial markets, risking of Treasury bondholders offloading sterling rather than watching their money being inflated away in value, the Government and BoE won't print their way out of this mess.

When houses deflate the government will incldue them in the CPI values to furthher fudge inflation....

In the end to quote a slipknot song.... People=S h it

Simone76

The sterling devaluing has already made buying in the UK massively cheaper when starting out with Euros.
When looking on www.oanda.com for the rates of the last year (May 14th 2007 until today) between Euro and GBP, then it used to cost 67p to get 1 Euro at its lowest rate and 80p at it's highest (highest was in April 08, lowest in July last year)

Average (373 days):0.72088 High:0.80990 Low:0.66790

So in July last year a 150k£ house would have cost 225kEuro, but in April 08 it would have only cost 185kEuro..that's a 40kEuro drop! 40kEuro buys a lot in Euroland...

dougk_2

A house dropping by 80% is unrealistic as the cost of the materials alone in the house at todays prices will be worth more than that.... remember fuel prices rising means the cost of goods is higher..

Whilst there are predictions going on I will say this look at this Forum in 10 years time and the price of a house will be considerably higher than it is today. eg a £300,000 house sold today will be worth more than that in 10 years time!

WTF?_2

dougk wrote: »

A house dropping by 80% is unrealistic as the cost of the materials alone in the house at todays prices will be worth more than that.... remember fuel prices rising means the cost of goods is higher..

Whilst there are predictions going on I will say this look at this Forum in 10 years time and the price of a house will be considerably higher than it is today. eg a £300,000 house sold today will be worth more than that in 10 years time!

Sure. And what will a litre of petrol, a loaf of bread or a pint of milk cost in relation to today, do you think?

MissMoneypenny

dougk wrote: »

Whilst there are predictions going on I will say this look at this Forum in 10 years time and the price of a house will be considerably higher than it is today. eg a £300,000 house sold today will be worth more than that in 10 years time!

Or they could be worth the same in 10 years time as they are today. eg a £300,000 house sold today will be worth £300,000 in 10 years time. Think back to the last crash and recovery.

Pennywise

Treadmill wrote: »

If property prices fall by 80% the majority of homeowners in the UK will be in negative equity.

80% is just fantasy

Not at all. Just as house prices rose quickly, they can fall quickly as well. 80% may be extreme, but not impossible.

m00m00

possible vs impossible isn't the issue here (100% falls are actually possible)

what's the issue is probability

Graeme7777

Hi,

No economist here but even to my untutored mind an 80% drop in prices seems extreme.

I would have thought that as long as unemployment doesn't rise too much, most homeowners will be relatively unaffected by the turbulence in the credit markets. As long as you can keep paying your mortgage payments and don't have to move home, I'd guess you'll be all right.

Perhaps some bright spark can quantify what it would take for house prices to drop by 80%? e.g. 65% of homeowners would panic sell their homes in a few months? Such a statistic might put the assertion of an 80% drop ("plunge", I would suggest) into some realistic context.

Can't see it happening.

Thanks to the OP - some interesting responses too.

Pennywise

For the past few years, the only winners have been those downsizing or selling up completely. Anyone moving up the property ladder has been a loser.

If prices collapsed, the reverse would be true. Those downsizing would get less in a years time than they would have done last year, but those moving up will gain.

The only requirement to keep the market moving would be the ability for mortgages to be transferred between properties, regardless of property value. Such an idea may seem laughable at the moment, but given a massive price crash, it may well become the norm - banks won't want thousands of repossessions to deal with. Just like they have "accommodated" high prices though high wage multiples, non status mortgages, 35 year mortgages, etc., if the need arises, they will find ways to transfer mortgages rather than forcing repossession.

For example, my home is worth £300k and the home I want to move into is worth £600k at the moment. If you had say a 50% fall in prices, I'd only get £150k for mine, but I would expect my next move to fall in price to £300k, so my "cost to change" is only £150k whereas it was previously £300k. I am a winner.

In that same example if the people who own the house are moving abroad, last year they'd have got £600k to take with them. Next year they'll only have £300k so they're losers.

We are lucky in this country in that despite all the state control of so many things, the housing and banking markets are still relatively free of political interference and are therefore still relatively dynamic and quick to change according to market conditions.