How can house price's fall so much??

PasturesNew

mr.broderick wrote: »

Pn i do like you but you are somewhat an anomaly. How many other ftb out there have got £150k in the bank waiting to swoop, let me tell you not many. The vast majority of the people who STR'd (I did this by the way) are currently seeing their savings eroded by poor interest rates and a higher cost of living (Definitely noticing everyday things shooting up in price round here especially eggs). We will not see a crash unfortunately just a 10-15% percentage drop from peak. I have a theory for this, people are impatient. Can I just add i am very disappointed my ronaldo thread has been moved.

Savings are not being eroded, interest rates are increasing in fact. Disposable income is, but with prudent saving (and visiting the OS and DFW boards) people can save more of their disposable income as they learn the valuable lessons of frugality, value and worth.

If a FTB has £20k saved and somewhere costs £100k now, they can look to swoop when it's dropped to £60-70k. If in that time they can add another £5-10k through interest and further savings, then it's stil good.

Even a 10-15% drop from peak puts them closer. Just not today. Patience is the name of the game. Rome wasn't built in a day; home won't be gained in a month.

As for Ronaldo ... pfft. Footy. Boys and footy. Just pffft.

P.S. as for me swooping, I'm a very slow-moving type of animal. I'll mull it over for months once I decide it's about the time and I shuffle out to view. No rush.

IveSeenTheLight

woodbutcher wrote: »

Glad i aint got no mortgage and couldn't care less what my house is worth,because it is "home" and you can't put a price on that.

Good post, but can I presume that at one point you did have a mortgage for your house?
I too will love the day when my properties are mortgage free and that particular monthly outgoing has gone from my spreadsheet

tryinhardtosavethepennies

m00m00 wrote: »

yawn, we don't hear this tired argument all the time on here.


there's plenty of property owners who think that the prices are simply no longer sustainable at the peak levels given the link to wages.

Now, this makes for an interesting poll!!!

Instead of a simple "how much will house prices fall?" poll, perhaps someone very clever indeed could invent a poll in which you first have to state whether or not you're a home owner, and if so whether it's mortgaged or not, and then what you think values will fall by...that would be very interesting!

Anyone got the know-how?!

mr.broderick

PasturesNew wrote: »

Savings are not being eroded, interest rates are increasing in fact. Disposable income is, but with prudent saving (and visiting the OS and DFW boards) people can save more of their disposable income as they learn the valuable lessons of frugality, value and worth.

If a FTB has £20k saved and somewhere costs £100k now, they can look to swoop when it's dropped to £60-70k. If in that time they can add another £5-10k through interest and further savings, then it's stil good.

Even a 10-15% drop from peak puts them closer. Just not today. Patience is the name of the game. Rome wasn't built in a day; home won't be gained in a month.

As for Ronaldo ... pfft. Footy. Boys and footy. Just pffft.

P.S. as for me swooping, I'm a very slow-moving type of animal. I'll mull it over for months once I decide it's about the time and I shuffle out to view. No rush.

Are you sure interest rates are rising pn?

johnycoldears

mr.broderick wrote: »

Are you sure interest rates are rising pn?

I think it's fairly obvious he means mortgage interest rates not the increasingly irrelevent rates set by the BOE.

Today's examples attached.

http://news.bbc.co.uk/1/hi/business/7474066.stm

http://business.timesonline.co.uk/tol/business/money/property_and_mortgages/article4213538.ece

Would you like to provide any examples of recent cuts ?

mr.broderick

johnycoldears wrote: »

I think it's fairly obvious he means mortgage interest rates not the increasingly irrelevent rates set by the BOE.

Today's examples attached.

http://news.bbc.co.uk/1/hi/business/7474066.stm

http://business.timesonline.co.uk/tol/business/money/property_and_mortgages/article4213538.ece

Would you like to provide any examples of recent cuts ?

No Johny it wasn't obvious.

abfmdf

How much house prices will fall is unknown as there are too many variables and considerable complexity.

I don’t think anyone should be criticised for buying at the wrong time, as many people believe renting is simply paying off your landlords mortgage. Furthermore there has been tremendous pressure for people to buy property as it is seen as a sound investment were money can be made if can only you can get on the housing ladder.

Some people have been LUCKY and been able to sell at the right time, and it is easy to criticise with the benefit of hindsight. However no one knew how the subprime mortgage crisis in America would affect the UK ( opinions at the time varied considerably) , or indeed who would have predicted the Northern Rock fiasco. While some people see the benefits (ie it will only cost 30K to upgrade from a 3 to 4 bedroom house instead of 100K) It has to be remembered that most people first have to sell their house, which becomes a far more difficult process. Coupled to the fact that mortgages are now more expensive, there is no longer the momentum from first time buyers (a chain of properties is sold before someone buys your house and that starts at the low end of the market)
So in practice few will reap the benefits (those moving to the UK or people with cash in the bank) and it looks as though we’re in for some rough times ahead.

Rabiddog_2

How true.. Most people only have the one house and therefore their ability to profit when prices go down and prices go up is strictly limited. Those who do (use their one house) are in some ways putting profit before their familys happiness, but they may consider that an acceptable compromise. Most people don't buy or sell when there are vast gyrations in the market, just steady increases or decreases. People WERE predicting the fall, but they did it for a period of four or five years. Even those who have predicted the fall will get it wrong in the degree . Hindsight is the only twenty /twenty vision. There is no one time when its right to buy or sell, there are years or particular local factors (olympics, new drug dens, oil rigs). The Uk housing market doesn't work as a whole.. presumably the first shoots of recovery will be felt in London but who knows? possibly L'Pool ?