Prices will fall by 50% in four years

chucknorris

homelessskilledworker wrote: »

see, the abuse ALWAYS comes from you guys

Actually it is you who usually starts it, certainly with me anyway

You are all property bears, but all put on a front of being Bullish

Why else would you be posting on here?
I personally post on here as I have a vested interest and an opinion of something I think might happen soon where I hope to profit if not suffer less than most.

What is the point in putting on a front? Where does that get anyone?

You guys cannot even be honest, you are all "100% certain" that the imminent future of property prices is secure..Mmmmm ok:)

Nobody is 100% certain, it is just a case of balancing the probabilities and forming an opinion. I am however 100% certain that I personally am safe from financial disaster. Which is why it is laughable when you keep saying that I am worried. If it takes a lot longer for things to improve I make extra rental profit from having tracker mortgages. If the economy does improve and rates go up and the housing market picks up I will sell up most of my properties.

sabretoothtigger

nollag2006 wrote: »

Quite a few others on this thread also recommended piling your life savings into gold over the past year or two.

Ouch ! That's got to hurt!


:rotfl::rotfl:

heathcote123 wrote: »

Yes, that would be pretty painful, especially if it was a house deposit. You'd set yourself back decades...

Talk about risk management eh?

The gold price has risen over the last two years. Over one year its flat, buying on peaks would be the painful drop. Dont buy all at once would seem best risk management

SLITHER99

Only read a few posts, but...

I got my mortgage 100% in 2006. Amazingly, I am not destitute, I've never missed a payment and my credit is good. Shock horror - not everyone who went 100% is a lazy !!!!less loser who defaults on loans. It's more reflective of how young people start life after Labours 13 year misrule and selling out MY future!

Second, in the fantasy world where there is some epic property crash and house "valuations" drop 50pc, what makes you think there will be anything for sale? I'd do just as my parents did in the 80s recession and stay put. What, do lenders routinely turf out mortgage holders in negative equity!?

We already saw these effects in 2007 when prices fell significantly: lots of first time buyers who wanted to buy, but no housing stock on the market (who wants to sell, have nothing and still owe? Get real!) and no mortgage availability to buy them with anyway! When 100% mortgages left the scene, FTBs were out of the loop.

However housing prices and the market in general is down - and will stay down until there is a proper solution for first time buyers, who are the only source of new money into the market. No, slashing houses by 50pc won't do it; if people can't afford £200k, how can they afford £100k? And what happens to the money lost in defaulted mortgages from people who did buy at £200k? Another Bailout! Lol.

IMO, banks should reintroduce 100% mortgages, provided a FTB can prove that they spend a similar amount in rental fees over two years or so, with no missed payments. Sure, that not a guarantee of solvency, but a good indicator that you're lending to someone sensible...

Zekko

SLITHER99 wrote: »

if people can't afford £200k, how can they afford £100k?

I would think the answer to that is pretty obvious.

Anyway, it does appear that house prices will continue to stagnate for the foreseable future, with prices holding quite firm either way; 'no large crashes', and 'no large inflation'.

Mrs_Arcanum

Zekko wrote: »

I would think the answer to that is pretty obvious.

Anyway, it does appear that house prices will continue to stagnate for the foreseable future, with prices holding quite firm either way; 'no large crashes', and 'no large inflation'.

Suspect this is the reality. The cost of building new houses has not changed vastly and I cannot see landowners selling at hugely reduced prices if they can hold off for better times. So demand will continue to outstrip supply.

SLITHER99

Mrs_Arcanum wrote: »

Suspect this is the reality. The cost of building new houses has not changed vastly and I cannot see landowners selling at hugely reduced prices if they can hold off for better times. So demand will continue to outstrip supply.

Agree; as long as mortgages continue to be out of reach to FTBs, then that will be the case.

Blacklight

brit1234 wrote: »

You will see over the next few months that 50% falls in house prices will increasingly spoken of as reality sets in. Inflation is rising and the days of low interest rates are over. That means traditional lending again which will bring prices back to normal.

:j

LMFAO

4 years... you could have paid off most of a mortgage

C_Mababejive

I dont have any vested interest as i dont own a house but i do have enough pictures of HM Queen to buy one outright should i choose.

Much of the debt that we keep hearing about is in fact geared to unsustainable house price rises in the past and sooner or later,someone will have to take a haircut for it but how?

If house prices continue to decline,people wont be able to sell as they cant or wont take a haircut.

There was definite unsustainable property speculation in the 90's which had no basis.

I need only take one example very close to me. A small two bedroom modern end terrace with one bathroom and small garden.

28/9/01 sold for £48,000
28/05/04 sold for £97,000
as of today,current zoopla estimate £110,000

Estimated rental value £650 pcm..total BS.

So those were the prime main burner years for ramping of property values. 2001>2004. Houses doubled in value. Did anyones salary double in value? I know mine didnt and i consider myself quite well paid.

So what happened? well the media played a part with a plethora of buy it,invest in property type programmes.

The finance industry backed mortgages on the strength of these overinflated prices. People bought into it.

Those mortgage debts were securitised,repackaged and moved on. Tne magicians in Wall street and the square mile amongst other places,weaved their magic and made their fortunes.

So i ask again,,who should take the haircut?

Should it be everyone in the form of bank recapitalisations and the theft of peoples savings via QE or should it be those home owners who should now face the fact that their home is just that. Their home. That is its primary function. Its secondary function may be as an investment vehicle but this time,the investment went wrong. Thier home is valued at much lower than when they bought it .

BUT WAIT..

It isnt all bad because they still have possession of that pile of bricks and it is still their home.

Further,inflation has made their mortgage payments comparatively smaller with the passage of time.

So its not all bad.

The only problem is of course,they dont/cant sell at a loss....so the market stagnates. More and more homes stay on the market for longer and longer.

Buyers become more and more afraid to pay asking prices or close because they dont want to inherit the haircut which comes with the house and why should they?

Its a time bomb....

Any solutions please..??

sabretoothtigger

C_Mababejive wrote: »

So i ask again,,who should take the haircut?

Should it be everyone in the form of bank recapitalisations and the theft of peoples savings via QE

QE and other stuff is already a reality. So its done, the rabbit is in hat all we need now is the trick to play out.
The payment is taken from currency value and whoever holds it, split a bill 60m different ways and its much easier

finance industry backed mortgages on the strength of these overinflated prices.

The finance industry is about the same as your insurance company quote, who creates the prices?
They are selling, packaging and managing your business but the important part was the underwriters of the debt

Biggest motivator of house prices and underwriter was USA government.
Thats the beginning and end of this almost certainly.

90% of USA mortgages are government financed.
So when the tide goes out and that backing evaporates to zero; thats when you have the final bill arrive and most likely a true price for housing not just in USA but likely UK.
We are closer to New York then Europe on finance so far as I can tell

nollag2006

Just checking in to see if the 50% fall has happened yet?