MikeCardiff

iTrader: (2)

I look at the prices where I live now and you're right, a lot of them are the same, but thats because its the same houses that were for sale at that price a year ago and havent sold !

The village I live in is one of the more desirable places in the area, but the only houses that are selling are the relatively cheap 2 bed new build starter homes. The £200K - £450K 'family' homes arent shifting at all.

Dream Weaver

Lancashire is huge, and has plenty of dire places (like some of those on the list you posted). I'm talking about where I live, the village I live in.

It's always been a hot spot because its a nice place to live, and only 45 mins commute for the Manc lot so people want to live here. Its a small ish place, and there is still more people want to live here than there are houses available - we still get notes through our door asking if we are selling up!!

The next town is Nelson, and thats a different matter - nobody wants to live there

MikeCardiff - houses sell within days/weeks here - I haven't seen a single house this past 12 months that has lasted more than 1 month up for sale, which is a pain as I'm looking out for something for my mother in law, but they sell straight away.

Dream Weaver

Petem - just spent some time on that snake site, what a load of cobblers - it only shows prices that have dropped and doesn't show any increases Hence why I can't find a single property on there from where I live.

john banks

RICS survey - 1% surveyors seeing rises, 61% seeing falls, levels not seen since the early 1990s. The period since the 2005 slump will likely be seen as the dead cat bounce that it really was pumped up by negative real interest rates.

3times

Whats so funny?

I would guess most of the comments on here are from people outside of financial services as most I know that work within the industry are not seeing what the scaremongering press see. All we are getting is a correction but while the demand significantly outstrips the supply said correction will be small.

We took on 2 new advisors at the end of last year and are looking at another 2 in Q1. Would we be doing this if we felt the market was at a low.

Terminator X

iTrader: (7)

The doom mongers are merely trying to make themselves feel better as they all sold up 5yrs ago when they first predicted a crash & now they can no longer afford to buy. They're desperate to see a crash in order that they can get back on the ladder! Sorry guys, you're fooked!

TX.

john banks

Well I sold October 2006, and I can still afford the sort of house I want with a 25% mortgage. I'm just not willing to pay top prices for what looks like a depreciating asset for a little while, so my plan is to get back in for the same sort of house without a mortgage.

3times, the financial sectors' ability to predict disaster is terrible, and you must have a very interesting interpretation of the news this week if you think this is scaremongering. Commercial property funds are preventing withdrawals, lowest surveyor confidence since the early 90s, massive write downs of banks, bond insurance collapsing, Bush handing out tax rebates to get them spending even whilst he has a massive deficit and inflation that is nearly as high as the interest rate, the majority of US citizens think we are either in recession or about to be, negative savings rates, dramatically rising foreclosures, dollar and sterling getting zapped, gold going mad, one of the worst starts of the year to the markets for years, one of the UK's darling mortgage lenders an absolute basket case... What good news have you got? I'd be interested in what you think will happen after the downgrading of Ambac. Personally I think this is going to be shockingly bad.

PaulC72

As long as we have SN all will be well. sit tight and wait to see what actually happens, although if people say the same thing year on year it will come true even partially eventually I just hope it is not too bad if it is going to happen for all those people who will suffer. I never like to see people struggle or even become homeless even when other are gloating over the prospect...

Ringpeas

House price = affordability-supply+demand+confidence (very simply)

If we have a recession then affordability and confidence will fall. Supply will rise.
Demand will weaken slightly.
The credit crunch has already reduced affordability, along with higher fuel cost.
It is just maths really.

Just look at what is happening in the US. Prices WILL fall, by how much depends on how many people end up losing their jobs, or THINK they will lose their jobs.

Just my 2P

Petem95

Unfortunately it's people like you and B2z who are fooked - you've bought at the top of the biggest housing bubble in history, and now get to see the value of your house fall significantly. You surely must know the market is looking doomed - you cant stay in denial forever

The winners will be people like john banks who got out while prices were at crazy levels, and stand to buy back into the market for significantly less in a couple of years.

I dont own a house, nor do I intend to buy one in the UK, so I'm just watching and enjoying the show

PaulC72

I am a little curious about the amounts of rent people are paying while they wait for this bubble to burst, paying dead money for no possible gain seems a little pointless at least owning a house it is yours, and any increase in value will provide a profit no matter how small & to live in a house of the same value as you would be buying would or at least should cost you the equivalent to the mortgage. People will still be lining the pockets of the landlord even if the house market crashes by 10%, most landlords have more than this in the equity anyway, rental demand will increase as as people lose their houses in this so called situation they will need to live somewhere.

Or maybe I am blowing smoke?

3times

As you rightly say commercial property funds are preventing withdrawals, but its the small investors that invest in medium to long term funds and try to get short term gain that want to do this, the institutionals are staying put as they realise that you only lose money if you withdraw.

I don't know where everybody gets this low confidence from surveyors as we are not getting anything downvalued and are finding properties are being priced right.

As for NR being a darling mortgage lender - I have not used them for about 3 years as I don't, and never have, rate them. They were only really any good for 100% + lending but I rarely do any of that. Another thing to remember about NR is they borrowed something like 92% of the money they lent, unlike say Nationwide who lend about 70% of their own money. The sh*t was always going to hit the fan with NR, it was just when.

As for the financial sectors ability to predict disaster, maybe its because its not as bad as the press make out. Or is it that we always think of the glass being half full!!!

Unless I was actually looking to move I would not sell now in the hope that prices will decrease as I feel that lots will get their fingers burnt, some will gain and good luck to them.

Got to stop now as I am going out to spend some of the hard earned but will try to look in again tomorrow.

Hope this thread can continue in a sensible vein and not get stupid like some.

3times

Just a quikie before I go.

I bought in 88 at pretty much top money. Moved out in 96 with neg equity, but let it so someone else paid the mortgage. Sold in 02 for nearly double what I paid.

Bought my current home in 96, it is now worth around 5 times what I paid for it.

Property is not for short term gain.

john banks

PaulC72, I pay £875 a month including gardener for a 3000 sq ft six bedroom house with views out of every window of fields or a golf course.

Compare that with an interest only mortgage on the approx £400k valuation and then add buildings insurance and you'll see why it isn't dead money. I say interest only because that is the comparison that should be made with rent because it never gets paid off.

john banks

3times, this RICS survey sensationalised here: BBC NEWS | Business | House price gloom 'recalls 1990s'

kingofturds

iTrader: (1)

The only people that will suffer are the people have bought at the peak of the market and the "i'm rich" brigade who have re mortgaged their house upto their eyeballs to buy a x5 and a porche boxter for the missus

sti-04!!

I have some friends that have purchased properties over the last 18 months & they seem to think there is going to be another mass jump in prices. I personally think it needs to stabilse.
Especially for the BTL market

AllanB

I cna see a slow down happenning but by that a mere softening in the prices.

There are still too few homes available in may areas of the country meanig prices are sky high.

I sold a small two bedroom flat that you can't swing a cat in for £223K thats insane but its the going rate. Forget what people advertise things at find out from estate agents what they are selling for and you'll see form months people were over valuing thier properties.

Yes the market has dropped off slightly and people are being more cautious but whilst there are people with ambition who want to earn a good wage and are prepared to work hard there will be buyers, maybe less but I don't see a collapse.

If you've bought recently for short term sell in 6 months then yes you'll feel some pain but long term investments in housing ( the right kind) are still viable.


AllanB

Ringpeas

This will play out over a few years.

We are just getting the start of it now.

MikeCardiff

iTrader: (2)

Rent on my old house was £625 per month, which was cheaper than the average, which was around £700 for the same type of 3 bed semi in the area. House was worth approx £230,000. We did work it out once, and at that time, the cheapest mortgage we could get would have worked out with repayments of about £1400 a month to buy it.

Renting used to be dead money in the days when a mortgage cost less than the rent, but I dont think theres many places you can buy cheaper than you can rent now. If you work out the figures you can rent for a good few years before you would be losing out if there is even a smallish drop in prices in the future.

We bought at a time when prices were around their highest, BUT our mortgage was just over 2x our joint income, and the house we bought was around £30K cheaper because it needed work doing on it, most of which I can do myself. We could have spent twice as much on a house with the mortgages we were offered, but set ourselves a limit, and didnt even bother looking at anywhere that was above that.

We arent planning on moving as the house is big enough now, and being on a decent sized plot it has plenty of scope for extending easily in the future if we need more space. There are only 15 houses in our close, and generally the only time they come up for sale is when the owners get taken out in a box. Most of the neighbours have lived here for at least 20+ years, and arent planning on moving out.

I can see it may be worth less in a couple of years than we paid for it, but as it was bought as a HOME not a 'property' or investment I dont really give a toss. It will be worth more than we paid in 10 or 15 years, but as we arent planning on selling then it really isnt worth anything until we die and it gets passed on.

NACRO

Anecdotal evidence only but I was talking to the guy who manages my properties in the UK and he reports an average 10 percent drop in the selling prices of houses in his area of NW England (covering Manchester and towns around).
Other areas I have interests in (SE England) are showing falls of between 5 and 10 percent. Despite what the massaged figures might say the reality is that significant falls have taken place already.

The real question is when to buy in a falling market I guess.

john banks

In terms of timing, I was thinking of watching for the crossover of rental yield and mortgage interest, and then consider buying when the month on month drops are not too excessive. Thoughts?

TopBanana

Do you mean rent including yield?

I don't think BTL will be driving the market at all, so makes more sense to compare against a repayment mortgage.

MikeCardiff

iTrader: (2)

Common sense says there cant be another big increase in prices as the lenders wont be giving people 10x income or more to buy places. Anyone buying property now as a short term investment is either getting the bargain of the century, or is very stupid and stands to lose money.

Really, property prices and increases only matter if you are buying with the intention of making money out of it ( or are one of those people who insists on telling everyone how much their house is worth all the time ! ).

If you are buying a HOME then the value is irrelevant unless you get into difficulties paying the mortgage, and if you borrowed sensibly in the first place then this is unlikely to happen.

Sadly I think there are some people who are going to find it a struggle over the next few years, and I can see a lot of X5's coming on the second hand market

Terminator X

iTrader: (7)

I know that ... you sold 5yrs ago, now you can't afford a UK house + you'll never afford one. As above, you're fooked!

TX.

Terminator X

iTrader: (7)

Can you post up some links to these £875pm mansions pls? Thanks. Pics of the associated golf course(s) would be a Brucie Bonus.

TX.

Terminator X

iTrader: (7)

Eh A mortgage always gets paid off, be it after 25yrs or whatever. Rental of course never does.

TX.

Terminator X

iTrader: (7)

Why will they suffer? If there is a "crash", just ride it out. Sell in 20yrs time when the average house will cost £600k rather than £180k ish today ...

TX.