House Price Crash!

GDB2222

deemy2004 wrote:

Look the elections over ! We were bribed into letting labour in and most of us fell for the lies told to us about economic growth.

Hmmm, going waaaay off topic here, but actually most of us did not fall for anything. Labour received well under 50% of the votes.

meanmachine_2

Woby_Tide wrote:

Fair play, just a bold change of direction in your views, was assuming you'd just continue renting/saving and work on theory that savings over the mortgage term would instead be your 'equity' in future.

No change of direction. I'm sure to buy within the next 1-3 years. It just depends whether I wait or not.

Although Hometrack is falling, it's not falling at the rate that can be described as "crash territory", and the others point to no shift in prices.

This is going to play out over a looong period of time, I feel.

I'll definitely look again seriously in Feb/March. But the lack of an interest rate cut before Xmas seriously put me off.

EDIT: a Thought occured to me to the other day. We've just witnessed a "crash" in stock market prices. That's because people trade in pieces of paper, are largely male and have no attachment to the stock. In property, it's different. Women hold the purse strings.

I'll leave that thought hanging...

Rave

Women are just as vulnerable in an uncertain job market. It's my opinion that a substantial part of the house price boom has been due to BTL-ers, and these are investors with no particular attachment to their property. If enough of them get spooked and sell up, it could very easily tip the balance of supply and demand decisively in the buyer's favour.

House prices could never do a stockmarket-style crash like lose 20% of their value in one day, just because it takes time to sell houses and so the drops on the price indices necessarily come through over a period of months/years.

IN_LIKE_EVERYONE_ELSE!

deemy2004 wrote:

That is Gordies prime objective now - To ENSURE he becomes prime minister and to do so he needs to ensure the economy is growing and house prices are rising in some 3-4 years time. Hence deliver the pain now, knowing that the electorate will have forgotten or forgiven when the boom times return.

I predict the economy will crash just after Tony walks, the tories will get back in and be blamed for the next ten years of neg-eq, house repo's, debt and redundencies.

Get out your flak jackets.

Happy daze.

CautiousSpender

Buying and selling a house these days is a real nightmare. The government takes a large percentage and to make matters worse, stamp duty is not staggered i.e. next band applies only to the additional value. This leads to a very strange pricing situation, where property values stay below the threshold for quite a while and then there is a hugh jump in the price of the property. How many prices are just a few thousand pounds over the threshold these day.

The problem with these high stamp duty amounts is that they reduce the amount of money available for buying new curtains and carpets etc for the new property and therefore depress the economy.

Wish the Chancellor would look at the whole picture rather than just trying to get money out of those people who wish to own their own property rather than relying on the state.

deemy2004

as you say the houses are priced in relation to the banding... thus if there was no stamp duty the prices would adjust overnight to allow for this and hence no gain by the buyer... only the sellers would be better off.

deemy2004

IN_LIKE_EVERYONE_ELSE! wrote:

I predict the economy will crash just after Tony walks, the tories will get back in and be blamed for the next ten years of neg-eq, house repo's, debt and redundencies.

Get out your flak jackets.

Happy daze.

Don't forget the ageing population who will draw in the equity in their property by either movign down or emigrating either way a drag on the property market which will continue for many decades.

But when we at some point, again have strong sustained GDP growth then we will again have booming house prices...

CautiousSpender

I think it would be much better if the stamp duty were calculated on the difference of the house being sold and the house being bought. (Off topic - we get taxed on the interest on the money we have at a bank but cannot offset it against interest payments on loans!)

Joe_Bloggs

@Deemy2004

as you say the houses are priced in relation to the banding... thus if there was no stamp duty the prices would adjust overnight to allow for this and hence no gain by the buyer... only the sellers would be better off.

How would the sellers be better of or worse if they have to be buyers for some other property ? Please reply in at least a 117 page essay in PDF format.:T

@CautiousSpender
You can get an offset mortgage and have your savings compensate for your mortgaged borrowings in linked accounts. Businesses ,buy to let merchants, can offset interest paid on loans against their tax bills.
You can rent rooms in your house and get £4K+ tax allowances including money spent on curtains/furniture for these rooms. Get rid of stamp duty.
J_B. (That was my first smilie.)

Rave

Same story about repossesions at the BBC here:

http://news.bbc.co.uk/1/hi/business/4377938.stm

....except they've commited the cardinal sin of using a misleading graph which doesn't start the axis at 0, thus making it look as if reposessions have gone up hundreds of percent. NO! DO SOME GCSE MATHS YOU AMATEURS!:mad: