House prices..
- Thread starter fendi
- Start date
For sake of argument, my personal definition is 30% in real terms within 2 years +/- six months.
House prices have only ever kept up with inflation ... take out the peaks and troughs and your left with the grim reality that there isnt anything mystical about a pile of bricks and motar that suddenly gifts it with the ability to make money without the person owning it doing anything.
A house is somewhere to live. Timing is the difference between whether or not that place to live is a millstone around your neck, or something significantly less so.
Lastly, i cant quite recall the maths, but i think it was calculated that something like a 10-30 percent drop now can equate over the long term into paying HALF of what you would at todays (now slipping) prices over the term of the mortgage.
A house is somewhere to live. Timing is the difference between whether or not that place to live is a millstone around your neck, or something significantly less so.
Lastly, i cant quite recall the maths, but i think it was calculated that something like a 10-30 percent drop now can equate over the long term into paying HALF of what you would at todays (now slipping) prices over the term of the mortgage.
It seems extremely unlikely to everyone without a chip on their shoulder about house prices
Some people on this forum have been saying the same thing for years...
Taking last months london drop into account, all it would take is a few of those, compounded with stagnation for a year or so to easily hit that number.
Year on year, the last few months have turned the performance of the north east from positive, into negative figures - so its perfectly conceiveable.
Anyways, they went UP that quickly .... and the downward drops are usually quicker.
It seems extremely unlikely to everyone without a chip on their shoulder about house prices
Some people on this forum have been saying the same thing for years...
Yeah - and now we're right. Looking at how the market has been dominated by BTL buyers since the 2005 rate cut we would probably been right back then if it were not for banks lending crazy, ill-informed people, crazy amounts of money. That decision has now been shown to be a mistake - see credit crunch - so now we're left with the crash that should have stated in 2005. Only now it's be worse than it would have been there.
I know I'll never convince you Dolph - and I don't have the time to get into a long discussion on it today. Let's just come back to this thread Dec08 and see where the market is?
Good point.
beacuse of how long the market had stagnated for, coupled with a booming economy and very low interest rates then yes I would have said it was likely, so much so that in 1999/2000 I brought my house purchase plans forward 2-3 years as it was becoming very obvious what was going to happen
If you bang on about something for long enough, you'll probably be right eventually, that just makes you persistant, rather than says you knowledge or understanding
Once again, the credit was not the problem, the way it was packaged to hide it's risk was.
If you wish. I'm sure we did the same in 2005 and 2006 though
It seems extremely unlikely to everyone without a chip on their shoulder about house prices
Some people on this forum have been saying the same thing for years...
There seems to be very little differentiation between those who want a crash for personal reasons and those who believe there will be one
Indeed, for some reason they think that a crash will benefit them, which totally ignores the fact that a crash comes with a recession. Prices drop because people aren't buying, and given the general consensus of those wishing for a crash, they seem to think they'd still be able to buy...
You say that you've been a 'doom sayer' for 5 years. So you thought the prices back then were far too high and would have been telling everyone and their dog not to buy a house at such crazy prices.
If I'd have listened to you 5 years ago and rented a 3 bed house (around here) for £1000 a month then I'd have piled £60,000 into nothing while the market constantly rose and even if prices now came back to a level equal to 5 years ago I'd still have thrown all that money into a black hole and be no better off.
Well, they could if they had a £50K deposit
Personally I'm in an industry that will probably get hit reasonably hard by a recession (consulting) and have the means to buy a house tomorrow should I so wish.
I do think that houses will come down though and that's the main reason I didn't buy somewhere this summer.
The whole credit bubble is going to cause huge problems over the next year or two and this will deflate the housing market and probably push us into a recession too.
5 years ago the prices were silly ..... realistically the 2000-2001 levels should have been the peak in my opinion.
I came out of university at that time with no stable income, but everyone piled into property regardless ..... fair enough if you were grown up enough or with an income to afford you the ability to consider buying, but for those aged 28-29 and under, we are a generation who were handed a lifestyle that was only sensibly achieveable for the minority......
I came out of university at that time with no stable income, but everyone piled into property regardless ..... fair enough if you were grown up enough or with an income to afford you the ability to consider buying, but for those aged 28-29 and under, we are a generation who were handed a lifestyle that was only sensibly achieveable for the minority......
Yup, and all so that a bunch of 40-50 yr old ****s can enjoy a slightly larger house - its not as though at that stage of life they aren't already enjoying themselves more than we are...
The retarded thing is that when you are young, that is *exactly* when you need the money, you don't need it so much when you are older as you already have better career prospects etc. Life is utterly topsy turvey... but then thats the "free market" for you.
The main reason you need money when you are older is kids. That is one thing you generally do not have to take account of when you are young.
Soldato
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I tell you what really tee's me off about talking house prices. Why is it that if you say you believe prices will fall 30-40% you are branded a doomonger, or depressive thats trying to upset the apple cart.
However if you speculate that prices will continue to rise, pricing every first time buyer and youngster out of the market forever. You know the "you waited too long and missed the boat" attitude you instantely are considered a hero and financial expert.
Sad that a happy medium can't be found.
However if you speculate that prices will continue to rise, pricing every first time buyer and youngster out of the market forever. You know the "you waited too long and missed the boat" attitude you instantely are considered a hero and financial expert.
Sad that a happy medium can't be found.
I've been predicting stagnation with a slight drop possible for over 2 years now, is that not the middle ground?
Prices will balance where supply and demand meet, at this very moment, demand is a little depressed because some people can't get a mortgage due to tightening lending criteria, but that's not enough to drag prices down 30-40% IMO.
I've been warning against a house as an appreciating asset for a while now, I just don't buy into the doom and gloom idea...