Prices will fall by 50% in four years

steadysaver

Paul_N wrote: »

LOL, pickles taking quotes from krusty and phil.

It just goes to show what complete BS those two 'property experts' talk.

According to Phil (linky) "It is negative equity which forces home owners to sell"

:rotfl:

How can compete numbskulls like this be allowed on TV?

Having read through that link clearly everything will be ok. My fav quote from Krusty has to be -

"Don’t sell if you don’t have to. Your house isn’t worth less than it was, but people aren’t buying."

tradetime

tradetime wrote: »

RICS survey out tonight circa midnight expectations are for a figure of -97.2%

RICS survey came in at -92.9% verses alalyst expectations for -97.2%

http://www.forexfactory.com/news.php?do=news&id=90858

dopester

mitchaa wrote: »

At the moment you can still get a joint mortgage based on 4-4.5 times joint salary.

Go onto any high street mortgage lender, pop in your details and they will still lend you 4-4.5x income multipliers.

If things do tighten up through a credit crunch, i would expect this to drop back down to 3x multiple. (Why hasn't it already?)

50% falls equate to a price around £90k.

I can only assume wages go up, so the £25k average wage at moment will rise to around £30k in 5 yrs giving Mr and Mrs Average a 3x £60k

I do not think wages will drop, how can they, people are already on very tight budgets, if i for 1 was asked to take a pay drop i would vote with my feet and straight into another job.
I was awarded a 5.45% annual inflation increase last week. My company do a Jun-Jun FY. Police/armed forces/nhs etc all have annual payrises as do most people.

Big companies have unions to fight for them, (Mine does hence 5.45%)

So i dont think a drop in the average wage is on the cards if im being honest, as i doubt anyone can realistically afford to take a pay cut. If they were asked to do so, i would imagine a lot voting with their feet.

mitchaa. Please tell, what would be your advice to the young City folk who are now being offered starting salaries which are 4% - 5% less than those offered last year?

Would you suggest they refuse the job offer? Or maybe be grateful just to be offered the job and accept it?

And the number of jobs available has fallen with redundancies and layoffs. Hmmm. How can you convince these companies to fall in line with your wage inflation enshrined beliefs?

After all, employees are already on tight budgets and pay rises are only fair yes. "We demand the money comes from somewhere!"

Surely the new recruits looking for work and existing employees who are hoping not to not be in further rounds of lay-offs should protest and vote with their feet straight in to another.. hmmm. Seriously mitchaa, I think you've got some waking up to do, and this applies not just for City jobs.

The Independent

Salaries in the City hit by credit crunch

By Kim Sengupta
Thursday, 12 June 2008

Although still the envy of other professionals, the average take-home pay of new recruits to London's financial sector fell last year.

Candidates signed up by Morgan McKinley for investment banks, hedge funds and asset managers receive 5 per cent less than their predecessors did this time 12 months ago. Joslin Rowe, meanwhile, which provides staff across the financial sector, reports a pay drop of 4 per cent.

Both firms say that the supply and demand situation has quickly reversed, to new graduates' detriment: there are now far more people seeking jobs in the financial sector than there are vacancies available, with the inevitable effect. The number of new jobs had fallen by 17 per cent in the last year as banks continue to lay off staff and operate strict hiring limits.

"The increase in available talent means employers have a greater pool of choice when filling roles," said Robert Thesiger, the chief executive of Morgan McKinley's parent company, Imprint Plc. "This is driving wage inflation down when compared with last year."

Snooze

IveSeenTheLight wrote: »

I have never said the above, why do people insist on mis-quoting others?

You didn't need to have the said the above. You're in bed with brodders and pickles with your silly 50% price increase predictions by the end of the year and so it made perfect sense to lump you all together.

Rob

IveSeenTheLight

Snooze wrote: »

You didn't need to have the said the above. You're in bed with brodders and pickles with your silly 50% price increase predictions by the end of the year and so it made perfect sense to lump you all together.

Rob

I most definately needed to say it.
I am not in bed withanyone else on this forum.
I say things as I see it and back it up with facts.
I have not once said I forsee 50% increases and I have not said prices will rise by the end of the year.
I have said that I can see prices dropping and I have said that at some point I believe prices will return and be higher than they were at peak in Sept 07. I don't know when I don't have crystal balls.

Just read the posts on their merit and comment as required.
No need for generalisation or mis-quoting, or any other factually incorrect lumping

dopester

IveSeenTheLight wrote: »

This first multipliers were apparently used in 1960 with a 2.5x ratio

IveSeenTheLight wrote: »

Does anyone think there will be a return to these multiples?

IveSeenTheLight wrote: »

the important thing to undersand is that multiples were not governed to ensure that the borrowers could afford but that the lenders were willing to risk and hence why the risk can be moved depending on the business requirements, not the borrowers.

• Interesting info about the 2.5 multiplier - thank you.

• Who knows? Perhaps even lower and even then only for sound credit risks? Have you read anything about the mortgage famine? How mortgages are more expensive, way above BoE interest rate / and arrangement fees? Or how some lenders want out of the market altogether? Don't be rushing to convince yourself that banks need mortgages products alone to survive in business.

Time Online (April 2008)

After years of plenty, the credit crunch is causing mortgages to become both scarcer and more expensive. According to Bank of England figures, the cost of a two-year fixed mortgage is higher today than it was six months ago, despite a 50 basis-point cut in mortgage rates over the same time-frame. And that's if you can get one at all. Growing numbers of mortgage lenders are closing their doors to new business, or raising charges to prohibitively expensive levels.

• Agreed. What £ lenders were and are willing to risk. And that goes a long way in fueling house price inflation, or house price deflation when credit availability is tightened up or becomes more expensive.

Quote below is from page 2 of this Telegraph article from about 3 weeks ago :

Credit crisis Britain: Cardiff's house price boom loses its roar
By James Hall
Last Updated: 12:24am BST 24/05/2008

Estate agent Filice blames the mortgage companies.

"People can afford to buy houses but the banks are not giving them the money. We have had two examples recently of couples who had mortgages agreed in principle, they then found properties, instructed solicitors and had offers accepted, only to be told by the banks that their terms had changed and they didn't have mortgages after all," he says.

:rotfl:

IveSeenTheLight

WoooHooo, Dopester agrees with a post of mine.

P.S. Not trying to convince myself or anyone else that banks need mortgage products alone to survive. No stats, but I would hazzard a guess that it has been one of the major ways they have genereated money and will probably continue to do so albeit at a smaller scal

dopester

IveSeenTheLight wrote: »

P.S. Not trying to convince myself or anyone else that banks need mortgage products alone to survive. No stats, but I would hazzard a guess that it has been one of the major ways they have genereated money and will probably continue to do so albeit at a smaller scal

Well we shall all find out during the course of the next 36 months.

Snooze wrote: »

You didn't need to have the said the above. You're in bed with brodders and pickles with your silly 50% price increase predictions by the end of the year and so it made perfect sense to lump you all together.

Rob

Maybe slightly unfair Snooze? I've always considered ISTL more of a strong minded independent.. sort of like a forum version of Statto (who this year went bankrupt btw)

Graham_Devon

Dan: wrote: »

Because they supported the claim.

Ok, so it's just a case of trying to show up as many as possible 34 months premature.

Maybe it's just me, but I just don't get the point. If there is one.

Graham_Devon

chucky wrote: »

exactly - here's the detail of the article again so that it doesn't get lost in the nonsense that Graham person is trying to create...

here's an update on what the derivative future traders are now saying


http://uk.reuters.com/article/idUKLNE57A03620090811?rpc=401&&pageNumber=2

I have absolutely no problem with the derivative updating. It's just I didn't get what the need was to show us who thanked who.

You can accuse me of trying to start arguments and portray things differently all you like. It's water off a ducks back. If you didn't write the stuff trying to show people up in the first place dragging up really old threads, I wouldnt be asking what the point in it was.