House prices won't crash - say Daily Express

mr.broderick

Snooze wrote: »

:rotfl: Thanks for the giggle Brit!

Rob

You're easily pleased aren't you rob?

MrDT

pickles110564 wrote: »

If you do one day be able to afford your own home, I would bet you will be the largest supporter of HPI.

I dunno about brit, but when I've bought my home I certainly won't be praying for rampant HPI!

When I come to the point in my life where I'm ready to downsize for retirement I probably will be (I'm not that altruistic lol, I very much have my own interests at heart), but that's a good few years away I doubt it'd be a big deal to me by then though, just a bonus if I end up being lucky.

fc123

Is there something in the water today? Everyone is so tetchy.


I am coming to the end of my trawl through this site for meaningful tips and guidance as decisions have been made (finally). That they will be the correct ones, who knows? But they are the right decisions for now.

The last 'crash' didn't feel like a crash as it went on...but I look back at graphs and stuff and it looks different to how it felt at the time.

The initial drop sliced off around 15% (88 - 89 based on my own househunting experience in SE London at the time) followed by a gradual slide downwards.

However, I know loads of people who bought at varying stages through the slide down....no-one knew when the end would arrive but life goes on.
The renting situation was very different then though.

We waited until end 89 and got a good deal (at the time but 'lost' £15k over 6 years), my sister wanted her own place aged 26, earnt enough for a mortgage and bought in 1993 for £45k. 3 years later it was worth £35k. But she 'gained' out of rising prices when she married and bought a huge place in 97. But the gain is only had if they downsized or STR......which they won't do as have 3 kids all settled in schools etc.

We traded up in '96 because of our life circumstances, not once did we think 'Hey, it's the bottom of the market', time to trade up....could have gone even lower.
BIL bought in 1994, Mother sold, remarried and bought in 1991.

I could list loads of examples and the point is that, yes, one can wait and wait for the 'bottom' (but one is never quite sure when that point has arrived until rises start again) and postpone things 'until prices go down' but sometimes life doesn't want to wait.

If you have no particular need to buy (in that renting suits your life) then one can play the waiting game................but, if not, then buy at the time it suits your life and needs (subject to affordability though).

I do have a close friend who postponed having a baby, because she wanted to buy a house 1st...but thought prices would drop. They could have afforded a cheaper area but wouldn't compromise......so everything was put on hold...and on hold....and now it may be too late....and prices are still too high in the desired area.
They may go down to 2001 levels but that could take years.

It's totally different for investors and they have to play the market and make decisions from a business point of view............just like any other business.

Sorry this is so long......needed a bit of therapy tonight.

brit1234

pickles110564 wrote: »

I would think that it is the bitter and twisted you that lacks common sense.
If you do one day be able to afford your own home, I would bet you will be the largest supporter of HPI.

No, not at all, do you think I am financially illiterate. I would like low prices so it is easier to move up the property ladder and have a family. With increasing house price inflation the gaps in the ladder get bigger and restrict what I can buy in the future putting me into more debt.

Its only investors, stupid equity release people and down sizers who need price rises not Joe public

IveSeenTheLight

dopester wrote: »

I suppose all of the 9 previous times since year 1570 where economic boom ended in a big credit crunch, which in EVERY INSTANCE saw property and land values crash, causing a lot of ruin each time businessmen, businesses, and with political backlash - holds no insight in to what will be the result of this credit crunch.

Honestly, when I read people talking about "crystal balls", it's quite clear they have very little historical knowledge. The past gives a serious insight to the future.

Does it?
Well according to the most recent crash, my area dropped a maximum of 9.08% in one year which was sandwiched between years of growth.

Between 1989 and 1996 (well announce as the previous years of crash in the uk), the HPI in my area grew 57%

Does this mean the same will happen again, well not exactly.

The point about crystal balls is that no-one knows how much prices may drop by and whent he market will return.

Given you close analysis of historic crashes, can you tell us what your crytal balls predicts for a percentage drop and when the market will return?

Do you wear a bandana, got long curly hair and big hoop earings travelling from city to city, village to village with your predicitons?

Whats Saturdays Lottery numbers?

Walter_J

Treadmill wrote: »

If you had bought at the peak just before the last crash your house would still be worth loads more today than it was then, so If you by at the peak of this crash, in time your house will still be worth that it is now. Unless somebody can show me a peak before a crash that is lower than a peak before a previous crash ?

I honestly don't care if house prices fall by 50% because I'm in for the long term, plus you have to live somewhere.

You're right, of course. However, put things into context.

If you had bought just before the last peak in 1989 the value of your house would have slid over the following five or six years and then started to climb again. It would have been between eight and twelve years before it was again worth what you paid for it!

During that period though, inflation averaged around 7% per year. So if a house bought for £100k in 1989 was again worth £100k in 1999 in real terms it was worth half as much.

Your plan of simply sitting out any drop in house values in the expectation that they will rise again eventually is fine if you can keep up with the mortgage payments.

The thing to remember though, is that many people over the last few years in their desperation to 'get on the ladder' have taken on mortgage commitments which they cannot meet. Short term rate fixes are now coming to an end and in some cases this means that the monthly payments can double! Combine this with the inevitable credit card debt held by the same people and we have a disaster brewing.

A year ago anyone in this situation could and would simply have remortgaged using the increased equity in their home. Those days are over.

Some in this thread have babbled on about how no-one has a crystal ball with which to predict how the housing market is going to go.

You don't need a crystal ball.

Just a few functioning brain cells!