Panic selling by landlords could turn slump into rout

nembot

I only have one leased property, if I was left without a tenant it wouldn't really affect my financial status - minus the rental income.

Would imagine this is the same scenario for many landlords, only people who really overstretched themselves - are at risk.

Pobby

I am hearing some very disturbing news in my sector of retailing. I think this was the year that folk hoped for a turn around. Had a good phone around today and all the customers announced that it has been dire since the start of the year following a very poor 2009. I certainly know that my sales figures are scary.

Little fears abound. VAT, tax and some are bandying around IRs back to 5%. The latter, imho, unlikely.

I wish i could feel a bit more bullish but there are a lot of worried people out there.

mbga9pgf

But commenting on past voids with the turmoil our new government is about to create is like driving down a road whilst looking in the rearview mirror...

The capital loss will come once all those on the SMI scheme fall off the end, starting later this year. Lots of supply plus reduced lending equals?

Thrugelmir

Oil_Shock wrote: »

Much as it churns my stomach to say, I'd be very surprised if this happens, the problem is we have a government (and possibly future government) that will use taxpayers money to prop up prices, homeowners and landlords. This would continue until we end up in the same position as Greece, ending up like Greece is not a forgone conclusion at this time.

Much as it pains me to say, house prices are unlikely to drop much below where they were last year at the bottom of the market, the reason ? insolvent banks would have to crystalize their losses as repossessions soared leaving the government to have to bail them out again, which of course it couldn't do.

Only external forces now can bring prices down to affordable levels for ordinary people.

House prices are outside of Government control. They may be influenced by changes in tax etc, ultimately market forces will determine what they are.

Why are the banks going to go insolvent due to house prices? First quarter results from LloydsHBOS showed flat lending at far higher margins. The mortgage banks its fair to say are now steadily repairing their balance sheets at borrowers expense. With improved lending criteria the situation looks increasingly sound. The black cloud on the horizon for the banks is exposure to Greek debt and Greek Government bonds.

The progressive tightening of credit availability is the external force that will stabilise house prices for an extended period into the future.

fc123

Pobby wrote: »

I am hearing some very disturbing news in my sector of retailing. I think this was the year that folk hoped for a turn around. Had a good phone around today and all the customers announced that it has been dire since the start of the year following a very poor 2009. I certainly know that my sales figures are scary.

Little fears abound. VAT, tax and some are bandying around IRs back to 5%. The latter, imho, unlikely.

I wish i could feel a bit more bullish but there are a lot of worried people out there.

This may be more due to changing times and different ways of reaching the customer rather than being due to house prices per se?

I hope it does pick up for you but the business model of agent as go -between is also changing as many companies reduce costs (from paying agent commission) or max out margin (from not paying agent commission) and using online to communicate and sell to their customers.

We did some wholesale and stuff in 03/04 and stopped. Even back then , having an agent was seen as essential. Now I have started again I do all my wholesale selling directly using e-mail etc instead. We have had agents aproach us but have decided ''no'' for now. I also buy cloth and one company I use also have an agent but I prefer to jiust go online and see what they have rather than making an appointment and so on.

Many of the shops I deal with are owned by younger owners (-30) and seem to prefer it and don't want OH travelling up to them (we have offered) but one export customer prefers the personal touch...he is 60 something though and very trad in his ways of dealing with things.

The shops you deal with are having to cope with not only with a drop in spend, but in how people choose to spend too.

I want to be upbeat to you ..........but maybe the internet selling just killed off that extra profit that made a small business profitable.

fc123

Thrugelmir wrote: »

House prices are outside of Government control. They may be influenced by changes in tax etc, ultimately market forces will determine what they are.

Why are the banks going to go insolvent due to house prices? First quarter results from LloydsHBOS showed flat lending at far higher margins. The mortgage banks its fair to say are now steadily repairing their balance sheets at borrowers expense. With improved lending criteria the situation looks increasingly sound. The black cloud on the horizon for the banks is exposure to Greek debt and Greek Government bonds.

The progressive tightening of credit availability is the external force that will stabilise house prices for an extended period into the future.

I like this post as it sums up the situation really succintly.

IveSeenTheLight

mbga9pgf wrote: »

But commenting on past voids with the turmoil our new government is about to create is like driving down a road whilst looking in the rearview mirror...

The capital loss will come once all those on the SMI scheme fall off the end, starting later this year. Lots of supply plus reduced lending equals?

We'll see.

There's been so many catalists to cause house price drops in the last few years that have failed to come to fruition that I am not concerned.

I intend to keep the properties for about another 25 years at least.

I'm fairly confident that there will be no capital loss over that time

Pobby

I so agree fc123. I do believe that we are going through a massive change and a scary one at that. Many of my customers have not totally embraced the internet or indeed have they wanted to. That , I think is where the problem lies. Frankly I don`t see this as getting any better. I know of one, drop ship business, run out of a back bedroom that is doing a trade that is startling. No stock, just a cut price web site. E mail the orders off once a day and then sit back.

I won`t being doing this for many more years, it is now very tough. Pure retail, bricks and mortar has, in my industry, just a few more years to run.

Spoke to some guys today, really nice retail outlets, and selling next to nothing. I put this down to firstly the downturn but also the massive increase of on line shops.

However, this is not just our industries problem I feel but a problem that is reflected in all retail trades. There are some that want to try, touch, use and that can only be supplied by traditional shops but at the same time, how many walk out and go online for the best price. I feel this is a very worrying factor.

Exocet

Pobby wrote: »

However, this is not just our industries problem I feel but a problem that is reflected in all retail trades. There are some that want to try, touch, use and that can only be supplied by traditional shops but at the same time, how many walk out and go online for the best price. I feel this is a very worrying factor.

Please can one of you experts explain to me why there are still masses of people content to drive for miles, queue and spend all day at the major shopping outlets like Bluewater, Lakeside, etc? When they can get cheaper, easier on the internet. Is it a new kind of worship, or some social event of some sort?

ps. I don't get it, I hate shopping.

PhylPho

Exocet: "shopping" was defined as "the new leisure activity" by, er, experts who define these things as long ago as the early 1970s. I didn't believe it. I find it hard to believe now.

I even didn't believe it in the case of the re-development of a dead seaside resort with which I was vaguely associated, and in respect of which -- after the ballrooms, the theatres, the cinemas and the Illuminations had all gone -- the planners said:

"People will come back. We'll have a big Morrisons."

Mad or what?

But then when I go into my (smallish) local Tesco's and have to navigate my way through screaming kids and screaming mothers and usually silent dads I realise, bitterly, it's all true.

Ah for the days of Mrs Figgs' corner shop. No bloody leisure pursuit about that, she was a right cow who wanted you in and off the premises double-quick. And quite right, too. Shopping as a leisure activity? The world's gone mad.