House prices fall 2.5 per cent!

Pobby

mr.broderick wrote: »

That is an excellent question and only you would have asked it, there is a reason but it would be unfair for me to expose my reasoning here.

Mr.B, please do share your reasoning on this one sir.

clobber_2

Gwan, we won't tell anyone.

Deadman_2

poppy10 wrote: »

Sigh... It's 26% a year. Go to classes.

26%?

Please explain your logic.

neas

poppy10 wrote: »

Sigh... It's 26% a year. Go to classes.

Its 26.2%

Why is it 26.2% and not 30% someone asked? Because if houses loose 2.5 % a month this happens:

100 97.5 95.0625 92.68594 90.36879 88.10957 85.90683 83.75916 81.66518 79.62355 77.63296 75.69214 73.79983
Its called compound interest... because 2.5% on 97.5 is less than 2.5% on 100. and so on and son on.

tomstickland

-2.5% per month is -26.2% over a year. The annual ratio is ((1-2.5/100)^12) However,to the level of approximation we're working to it's not worth worrying about a few percent.

tradetime

mr.broderick wrote: »

Prices will start to rise again in september.

Actually I fully agree, September 2009 just before the next leg down.

useless

dannyboycey wrote: »

It's not extreme. It's irrefutable fact when you look at the population as a whole. There are exceptions as always, but many, many people have been gorgeing on debt for too long. Now they have to pay the price.

If you want money to buy luxuries.... earn it! It can't be that hard to get your head around surely?

No, it's not hard to get your head around that you need to earn money to buy luxuries, hence why I think this is an extreme, very over-generalised view, with a condescending tone.

ManAtHome

Many poeple aren't getting their head round it though - uk plc has accumulated more personal debt in the last 10 years than the previous x thousand (since time began), can't say the same about wages...

mr.broderick

Generali wrote: »

So either unique insight or blind optimism.

Time will tell.

Toodle pip!

G

No not optimism as it is not in my interests for houses to get more expensive.

To be honest I sold a car to a mr mcdonnell who is regional director of mortgages for c & g and he told me this with a straight face, i didn't reply as i feared he was trying to knock me off balance and get a better deal. Hey I think there's more than an ounce of truth in it...

MYLITTLESISTERLOLA

I work in a financial institution and our economists/regional director etc are painting a bleak out look but the simple fact is no-one has any answers or any date that's 'the crunch' will be over ( unless they have a crystal ball I don't know about ) it's a case of suck it and see. From my own point of view first time buyer in a council house with 80% LTV taking into a/c 20% discount from council ( I've checked with my chosen lender & they confirm this will be classed as 80% LTV ), I am waiting to see what happens, Northern Ireland in a bit of a unique situation, the asking price for house next door has just dropped by 20k which works out at the 13ish% everyone is talking about
In my opinion I am not racing to buy until I see some sustained growth.
I agree with the comments, if your not intending to sell it could still effect you as your LTV is dropping by the month & fixed rate deals are expiring. I personally do not feel sorry for the people who have 115% mortgages, roughly translates as bmw in drive, designer clothes, accumulated debts all shoved on to the mortgage and they suddenly disappear !!! not quite that easy as they are finding out, the people who were buying up BTL like they were sweeties pricing FTB's out of the market it's pay back time !!:p . The biggest problem I foresee are the people who were getting an annual further advance to clear credit card debts, pay for new car & holidays, I have seen many of these in my time at work, SOME of these people are still spending like this will be an option, only to get themselves in debt and then blame the bank for not helping them !!! The finincial institution that I work in did not offer 100% + mtgs, we had no sales targets, we were actively encouraged to lend responsibly regardless of income to the bank ( not just recently but since I have been a lender 3+ years), people often got angry saying 'I came to the bank for help and there useless' when they had run up 45k+ unsecured debt living the high life. Banks have been heavily blamed for all this going wrong but quite frankly people have to accept that the buy now pay later mentality has came back to bite us in the bum
Sorry for the rant & spelling:rotfl: