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House price crash

ska invita said:
uk-average-house-prices.gif


jesus.... London.... fuck me
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Any more predictions 😂
 
People leaving London will free up properties for Russian, Chinese, American and other investors looking to keep their monies safe in a country where the filthy rich are lauded.
 
it turns out the tories know exactly how to permanently inflate house prices as a way of bribing their core property owning voters - no one told me
:mad: you live and learn
 
ska invita said:
it turns out the tories know exactly how to permanently inflate house prices as a way of bribing their core property owning voters - no one told me
:mad: you live and learn
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By its very nature, inflation is never permanent. A reckoning will come, although I'll admit it has been seriously postponed.
 
existentialist said:
By its very nature, inflation is never permanent. A reckoning will come, although I'll admit it has been seriously postponed.
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Even the reckoning will be temporary, the trajectory is upwards.

In around 2006-7, flats like mine in Manchester were being valued at around £70k, in the 2008 crash, the value went down to just under £50k. It's probably now worth around £180k.
 
It's so shit and also has a massive knock on effect for people who rent. The prices around here are getting worse and whilst out landlord is as good as you could probably hope for I don't want to push for some things to hard incase he then puts up the rent.
 
I've been muttering for more than a decade about how a house price reset has been overdue. Not that I am going to be delighted to be proven right, but it's always been inevitable. Though I have a feeling that my expectations are going to be seriously exceeded with what seems to be coming down the road now...
 
Predictions I've seen are that prices may fall but only to the levels of a year or two ago.

For most people they still own the house and it's only an issue if you have to realise it to fund something other than another house
 
Elpenor said:
It was inevitable having just bought a house one would happen
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we bought our first house at the start of the 2008 credit crunch. It was alright. You just have to sit tight. Fix your mortgage. Obviously.
 
When we bought our first flat (we are still here) in 1997 , the seller made a small loss, they'd bought it in 1988 I think and house prices barely moved in that decade. Whilst it is worth a lot more now - it is our home, and I've never felt the need to climb the property ladder until I ended up with Balmoral or something similar.
 
I think there might be a hard crash in some parts of the country. Not convinced London will have that. Lower pound will probably see a bunch of parasite investors swooping in, not least Blackstone, who the guardian have a long read about today.
 
rubbershoes said:
Predictions I've seen are that prices may fall but only to the levels of a year or two ago.

For most people they still own the house and it's only an issue if you have to realise it to fund something other than another house
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Yes. The most bearish view I've seen is that they'll drop by about 20% and they've gone up by about that in the last 2 years, certainly in London. Unfortunately, unless they've got plenty of cash stashed away most buyers won't be able to take advantage because they won't be able to get/afford the mortgage.
 
I think the prospects for London house prices are quite dramatic. An article from today's Telegraph goes into this in some informative detail. The chart below is a bit out of date, but it shows that dramatic prices collapses do happen (1987 to 1995). Many commentators are suggesting a 15% decline, but I guess it will be more: perhaps 25% ?


House-prices-Feb18.png
 

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  • Why London’s housing market is heading for disaster.pdf
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It'll drop but tbh the London market specifically may well continue defying gravity (at least to a degree) for a while yet on the basis that the pound is a reserve currency - mortgage buyers replaced by institutions and the parking of international wealth in a time of global upheaval. The real crash comes as and when this little economic Truss exercise we're seeing tanks the pound to the point where its reserve status no longer holds.
 
kabbes said:
Parts of the country that saw the middle classes paying silly money for houses as second homes and holiday lets are the places that are going to have the real last laugh here.
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It's happening already. The Welsh government has changed some taxation rules on second homes - ones that aren't run as an actual business for holiday lets - which have resulted in quite a few properties turning up on the market. Sadly, they're still priced well beyond the reach of most locals, but I think that it's the beginning of what could be quite a useful correction, particularly in view of these economic developments.

It's also pissed off some of the holiday let people - most of whom tend to be local people - because the bar has been set quite high as to how many nights' occupation qualifies it, and lots of local holiday let types are the sort who aren't necessarily running it as a full-on business, but just a seasonal thing. But hey, you don't make an omelette without breaking a few eggs...

Either way, I think this is going to be a turning point for house prices. And I am not even going to guess at what the drop could be - as 1991 showed, once a panic starts, and overcommitted people begin to try to bale out before they hit negative equity and have to pay to bale out later, I think we could see a strong downward pressure on prices. Post-1991, banks were having to hold back on the rate at which they foreclosed on delinquent mortgages, as the risk of flooding an already collapsing housing market with bargain-basement repossessions was too great. But if the collapse looks like it could be significant, it may even be that suddenly reluctantly-property-owning banks could just dump and run, too, which could send the whole thing into a bit of a corkscrew.

My stepdaughter bought her first house a month or so back, and just told me today that she'd got it on a 5 year fix. I think she's feeling quite pleased with herself - absent some dramatic change in their domestic circumstances, she's fairly well insulated against too much that can happen in the property/mortgage market for the duration. But property ownership shouldn't be like speculating on the money markets...
 
existentialist said:
Post-1991, banks were having to hold back on the rate at which they foreclosed on delinquent mortgages, as the risk of flooding an already collapsing housing market with bargain-basement repossessions was too great.
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Is that a thing that actually happens? I can see how it might if there were only one bank ... but if there are multiple banks wouldn't their individual motivations be to get rid of properties at reasonable prices ASAP before others beat them too it?
 
IMG_20220929_135840.jpg
Thats a graph of average UK house prices from 75-22 adjusted for inflation.
There's been speculation prices will go down 10, 15 or 20 pc. 20pc would take it back to 2003 levels.
Of course nobody knows what will happen. Wouldn't put it past them to announce a stamp duty holiday next year.

I don't fuly understand the economics of if but keeping house prices high seems to be a golden rule for Tories.
 
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