House prices to crash

[Uncle Spielberg]

Wealthy people buying 2nd homes and property landlords at the moment but if there is a crash it will not be down to lack of demand it will be to lack of mortgage finance which is only going to get worse especially with the FSA's proposals to make getting a mortgage much more difficult that it already is which is the most difficult in a generation anyway.

 

[cjd]

Sorry, but I think it does. If the vendor reduced the price two things will happen

1. The people searching a mortgage might get one at the lower level.
2. New buyers will enter the arena.

So keep reducing it and it WILL sell long before it reaches 1 penny.

Lack of mortgages has an influence on what people can afford, not on setting realistic house prices. The free market does that.

Has it never occurred to you in your infinite wisdom, that if house prices drop dramatically the same cycle of the "rich" will buy up all these properties, long before the average punter can arrange a mortgage. It has happened before you know.

The result...? More Landlords, property speculators etc etc etc

High prices at the moment are keeping property barons out of the market because the rent yields are insufficient to justify buying them.

As always....supply and demand will dictate prices. Always has...always will.

 

[Uncle C]

Wealthy people buying 2nd homes and property landlords at the moment.

OK, I agree with this (wealthy people in some areas means foreign buyers).

But, this is a buying sector that is driven by greed and opportunism and gains momentum through sentiment rather than the need to live in a house like Jo Public.

Like any bubble at or near its top, that sentiment can evaporate overnight if it is perceived their 'little earner' is about to crash in price. So current house prices are hanging on by a thread.

 

[Uncle Spielberg]

Has it never occurred to you in your infinite wisdom, that if house prices drop dramatically the same cycle of the "rich" will buy up all these properties, long before the average punter can arrange a mortgage. It has happened before you know.

The result...? More Landlords, property speculators etc etc etc

High prices at the moment are keeping property barons out of the market because the rent yields are insufficient to justify buying them.

As always....supply and demand will dictate prices. Always has...always will.

Spot on. In reality the cheaper properties will be taken by the professional landlords and the country will become a country of renters to wealthy landlords. The writing is on the wall and it will be back to the 16th century with the peasants dothing their caps to the landlord.

 

[Uncle C]

Has it never occurred to you in your infinite wisdom, that if house prices drop dramatically the same cycle of the "rich" will buy up all these properties, long before the average punter can arrange a mortgage. It has happened before you know.

The result...? More Landlords, property speculators etc etc etc

High prices at the moment are keeping property barons out of the market because the rent yields are insufficient to justify buying them.

As always....supply and demand will dictate prices. Always has...always will.

I have never preached on the morals of who should and shouldn't own houses.
Yes, speculators will move in, but that has nothing to do with whether houses are overpriced or not. It would seem that keeping prices high as you suggest is cutting off your nose to spite your face for poor old Joe Public

 

[Uncle C]

Spot on. In reality the cheaper properties will be taken by the professional landlords and the country will become a country of renters to wealthy landlords. The writing is on the wall and it will be back to the 16th century with the peasants dothing their caps to the landlord.

Some countries work beautifully on a rental market, as did the UK many years ago (together with a good supply of Council houses).

The home ownership market has been fueled by TV and greed.

 

[Uncle Spielberg]

What will be will be. The whole ethos of home ownership in the UK has finished for good now. The future will mean 30% of the population with own 100% of the property. The other 70% will rent off the 30%.

 

[cjd]

Yes, speculators will move in, but that has nothing to do with whether houses are overpriced or not.

Really...?

Which planet are you on...?

I read your opening post a few days ago, and as I have an interest in the property market, I scanned the various news outlets to see if there was any impending forecasts of "house price crashes" from the experts in the field.

Very little.

I assumed therefore, that this is just your amateur opinion.

Your orinal post, merely alarms those owning houses and looking to them to provide a pension if they downsize, and gives false hope to those young people wanting to join this merry-go-round.

People like yourself, are quite frankly, nothing more than scare-mongers.

 

[Uncle C]

Renting is not the end of the world. Regulations exist now to protect the tenants.

It has been proven time and time again that the only thing that really differentiates 'renting' and 'buying' is that the buyer has been convinced over the years that they will make a healthy profit as the house appreciates.

Remove this from the equation, or worse still reverse it with a house price crash, and renting suddenly becomes quite attractive.

 

[Uncle C]

Really...?

Which planet are you on...?

I read your opening post a few days ago, and as I have an interest in the property market, I scanned the various news outlets to see if there was any impending forecasts of "house price crashes" from the experts in the field.

Very little.

I assumed therefore, that this is just your amateur opinion.

Your orinal post, merely alarms those owning houses and looking to them to provide a pension if they downsize, and gives false hope to those young people wanting to join this merry-go-round.

People like yourself, are quite frankly, nothing more than scare-mongers.

Lets revisit this in 12 months shall we.

 

[Uncle Spielberg]

It alls become a self fulfilling prophecy. As I have said numerous times it is not that people don't want to buy at today's market prices it is because they cannot buy due to lack of mortgage finance. That is the only thing stalling the market and it will get worse so UC's dreamland of crashing property prices undermining the whole economy further may well come true.

 

[cjd]

Lets revisit this in 12 months shall we.

Interesting article on the BBC site titled "wannabe house buyers" on the 20th August 2010.... ( Unfortunately, I don't know how to ? "copy and paste".

Price Waterhouse have suggested a rise in REAL terms of 2% per annum between 2010 and 2020.

More interesting was the analysis, that house prices had increased in REAL terms by an average of 3% per annum , between 1984 and 2010. That surprised me.

Personally, I don't believe anybody knows for sure, what the future in house prices will be.........but I,m more likely to take notice of Price-Waterhouse than a scare-monger.

 

[larus]

Some countries work beautifully on a rental market, as did the UK many years ago (together with a good supply of Council houses).

The home ownership market has been fueled by TV and greed.

Very true. I have some friends who moved here from Germany. More people there seem to rent than buy, but rents are much cheaper. Over here, the rental market has been corrupted by Buy-To-Let landlords who want someone else to pay their mortgage for them.

The selling of council houses was, IMO, a good thing; it was targetted at allowing more people the right to own their own houses. The biggest mistake was by not allowing these proceeds to be re-invested. Neither Labour nor Tories have done anything to address this problem.

As for house prices; they are clearly overvalued. The rate of growth in unsustainable, and it is classic bubble mentatlity. The only suppport for house prices is from lack of supply. Without this issue, there would be a very big correction in prices.

 

[Uncle Spielberg]

Right click, copy , scan down, right click, paste.

 

[larus]

Right click, copy , scan down, right click, paste.

Care to elaborate ?

 

[Uncle C]

The only suppport for house prices is from lack of supply. Without this issue, there would be a very big correction in prices.

The lack of supply is gradually being corrected ever since the abolision of the House Information Pack.

 

[Uncle C]

Interesting article on the BBC site titled "wannabe house buyers" on the 20th August 2010.... ( Unfortunately, I don't know how to ? "copy and paste".

Price Waterhouse have suggested a rise in REAL terms of 2% per annum between 2010 and 2020.

More interesting was the analysis, that house prices had increased in REAL terms by an average of 3% per annum , between 1984 and 2010. That surprised me.

Personally, I don't believe anybody knows for sure, what the future in house prices will be.........but I,m more likely to take notice of Price-Waterhouse than a scare-monger.

As you rightly point out nobody knows which way the market will head. What interests me is why you call someone who thinks it will go downwards a scaremonger, but someone who thinks it will progress upwards out of the reach of first time buyers is not.

Seems you have some underlying vested interest.

 

[larus]

I meant it more from the supply/demand in general, i.e. demographics; and not the temporary movements in the numbers of properties for sale/buyers who can afford a mortgage.

 

[Uncle C]

I meant it more from the supply/demand in general, i.e. demographics; and not the temporary movements in the numbers of properties for sale/buyers who can afford a mortgage.

OK

 

[cjd]

As you rightly point out nobody knows which way the market will head. What interests me is why you call someone who thinks it will go downwards a scare mongerer, but someone who thinks it will progress upwards out of the reach of first time buyers is not.

Seems you have some underlying vested interest.

Uncle C.....opening line in his original post...."Here we go...it's showtime"

Price Waterhouse article is reasoned and backed up by facts.

I, along with ? 65-70% of the population have a vested interest in property prices.

The remaining ? 30-35% of the population who rent, I have no doubt, also have a vested interest in the property market. Who amongst them, would even contemplate buying in a "falling " market...? As was proven by the number who bought during 2007/2008 downturn.

No...(IMHO).....amateurs, have no place in spouting forecasts in this most difficult and important area.