pslewis

It never used to cost anything to start a mortgage ......... how can they justify £500 application fees??

pslewis

I don't understand PodCasts and new fangled stuff like that, but this could be interesting?

Money Talk Podcast: Making Sense Of House Price Predictions - 09/01/2008

Petem95

Blimey even the BBC with a house price article that isnt full of positive spin?!!

BBC NEWS | Business | House price gloom 'recalls 1990s'

PaulC72

Well if the house prices crash {or drop} this year next year they will pick back up they did after 1995 and they will again, it'll just mean people will have to wait to buy/sell or take a hit on the value, i oubt there will be any long term effect and most things run in cycles imo.

Also meant to add whats happend to PSL banned again?

davyboy

WOW! You were right all along Pety!

Petem95

I know

john banks

Using just a small part of my house sale money, today I made enough profits from gold to pay two weeks of rent

FriarTook

Ah, but - does it have a naughty step??

Because you are sitting on it while on SN

TopBanana

If it's of no interest to you, why did you start this thread?

Deep Singh

Some people need to wake up and smell the coffee

Petem95

Right, now I can understand why you are clinging on to the hope that prices wont crash! If I had bought a house last year (almost certainly at the peak of the biggest house price bubble in history) then I'd probably be trying to kid myself that prices wont fall either!

There is probably a good chance that houses will fall in value for at least the next 5 years, possibly longer, and probably fairly significantly - but as you say if you dont plan to move for at least 10 years its not really an issue.

john banks

If you keep your job, don't have to or want to sell you'll be fine. It hasn't taken long for houses to go up 50% though (I'd be more worried about negative equity and the limitations it places on you than you seem to be), and if wage inflation remains subdued then the debt may be sticky to inflate away as it often did in the past.

Jamescsti

My own personal experience is that house prices are dropping, my own position is i'm a first time buyer currently in the process of buying a house in leeds, the house i'm buying was originally priced 10k over what i'm paying for it.
The estate agent is literally calling me every day to try to push the sale through, we had 4 solicitors firms calling us to try to get us to use them for the legal side, not the actions of people who are snowed under with potential buyers.
Having said that i'vce been thinking for the last 3 years that there wil be a housing crash and it's not happened, in the end we have decided to take the leap onto the housing ladder, it's a good size house and will last us for the next 10 years and longer if neccecery, so whether prices go up or down doesn't really concern me as we have no intention to try to make money on it, it's a home for me and the mrs, and hopefully a future family, and it's affordable to us which is the main thing.

I think if there is a crash it will be the appartments which take the bggest hit, they seem to be throwing them up left right and centre and no one is buying them?

All my own opinion of course

TopBanana

I'm in the process of moving to a rented house.

The removal companies were falling over themselves to get the business. The guy we eventually gave the work to said that this is as bad as he can ever remember, and most of his work was due to emigrations.

Dream Weaver

Absolute rubbish

We're not clinging to anything as we bought our house during the middle of the rises but had made a huge profit on the old house.

I will give you £1000 cash if our house is worth less that what we paid for it in 5 years time.

Chris L

Agreed - there is a big difference between buying a house as a home for your family and loooking at over the next 10 years or so and those that have bought houses purely as an investment looking for capital gain through rising house prices. Long term (10 to 20 years), property is a good investment - that's always been the case, but what is different now is the make up of housing / mortgage market and this could lead a lot of people into trouble in the short term.

PaulC72

Even BTL are still good to have providing you have tenants {which there currently seem to be plenty of} if the house loses 10% 20% it shouldn't matter unless you are trying to sell otherwise just sit tight and wait for it to pick back up, can't really see any problems with it?

lozgti

Most people have the notion that the rent will cover the mortgage payment.Seems lots of landlords are having to accept lesser rental payments and pay the difference themselves.

Ok if you can afford it

Chris L

And that's where a lot of the problems will be - rental values are generally falling. So if you own 2 or 3 BTLs and you depend on rent to meet 100% of the mortgages on those homes and rental incomes are falling and you are coming to the end of that nice 2 or 3 year fixed rate deal.....

Deep Singh

Don't get me wrong I'm a bear on UK property but rents in London are not falling. They fell circa 2004/2005 but can tell you first hand that they have risen Q3/Q4 2007

lozgti

Is like a seperate country in the property market

Being serious though,people will only pay going rates and round here its dog eat dog between landlords.

Chris L

Exactly - average for a fixed rate mortgage at the moment is 7.31%. I was always advised that you work out rental incomes as 6% of the value of your property. Bearing in mind that a lot of BTLs have been financed on interest only mortagages, you get hit by the double whammy of a reduction in the asset value of your house and no decrease in the amount you have borrowed with rising interest rates. It is not difficult to work out what is going to happen.

"House prices are falling as quickly today as they did in the crash of the early Nineties and only further cuts in interest rates will avoid a property meltdown, according to the Royal Institution of Chartered Surveyors."

"The number of estate agents who report falling prices has soared to its highest level since 1992"

"The institute lays great importance on what it calls the 'balance' - the seasonally adjusted difference between the number of members who reported a fall and a rise. This is currently 49.1%, the highest figure since November 1992."

"The crunch has hit almost every part of England and Wales, while the West Midlands is suffering its fastest fall in history."

All quotes from an article a couple of days ago - now I'm not one of those 'doom mongers' who predicts 50% falls, but I am also not blind to the prevailing economic conditions. Anyone who thinks the housing market is not in for a serious correction over the next 12 months or so is living in cloud cuckoo land.

3times

I take it you are including sub prime mortgages in your 'average' calculation.

There are loads of fixed rate deals at the moment below 6%. My advice to a lot of clients at present though is to take a tracker with no redemption penalties. That way you can take advantage of the possible 4 rate drops this year and then transfer to a fixed rate, when they come down, at little cost.

Prices are dropping but after allowing for seasonal slow down its not that bad.

Deep Singh

Dream Weaver

Has anyone looked at their local house prices, rather than just reading from articles?

I'm currently on our local estate agent sites as I haven't checked the market for a few months - nothing has changed, prices remain in the same state (i.e. rising slowly) from the terraced housing right up to the big detached houses.

I can't imagine them dropping either as housing demand is still huge here.

fast bloke

The 1992 quote has been taken out of context. There are the same number of surveyors reporting falling prices now as there were in 1992. Main difference is that they are reporting 0.8% drop in NOVEMBER rather than the consecutive monthly drops of 5-6% seen in 1992. The also report a month on month rise in December of approx 0.8%, so the 0.2% drop in October gives a quarterly fall of 0.2% (this is based on completions instead of asking prices, which are basically a made up figure anyway)

Petem95

Well when RICS are saying its members are reporting the lowest demand for property since 1992, I think I'd believe them rather than your hunch that demand is still huge.

Look at the reductions in Lancashire here;

property snake -- listings in Lancashire -- find falling house prices in your area

Credit crunch is really biting, lenders pulling decent deals and being much more restrictive on who they lend to - FTSE 100 has had its worst start to the year since 1978 - if property prices are not showing near double digit Y-on-Y falls by the end of the year I'll be amazed.