Xiled Posted June 15, 2005 Report Share Posted June 15, 2005 Simple question, do you believe that current prices will be maintained in the housing market or are we heading for a similar fall (like the crash from 1989 onwards)?Xiled. Link to comment Share on other sites More sharing options...
Guest WillsbridgeRed Posted June 15, 2005 Report Share Posted June 15, 2005 I hope so, other wise me and my girlfriend are doomed to renting for the next couple of years Link to comment Share on other sites More sharing options...
Evocare Posted June 15, 2005 Report Share Posted June 15, 2005 I hope so, other wise me and my girlfriend are doomed to renting for the next couple of years←Me too, I'm renting atm, i'm not complaing, but eventually i want to buy a house again, there is noway though i'm paying these UK prices, its a ripoff.I would rather buy a condo in K.L for £35k and suscribe to Cityworld Link to comment Share on other sites More sharing options...
lukejones2 Posted June 15, 2005 Report Share Posted June 15, 2005 Simple question, do you believe that current prices will be maintained in the housing market or are we heading for a similar fall (like the crash from 1989 onwards)?Xiled.←I believe that the bank of England will not let there be a crash and that house prices will continue to grow but at a far slower rate, he only reasonthey are struggling at the moment is the relatively (in comparison to recent times) interest rates. These were needed to try and curb excessive consumer spending and to bring the housing market back under control. Now that it is controlled, I can only see the rates lowering or being held at the very worst. I personally would buy as soon as you can afford it but there is no need to rush. For example, I will continue to rent for about another year as I save a deposit and watch my salary increase faster than house prices. I will be in a better position to buy then. Link to comment Share on other sites More sharing options...
Guest Mrs Cityboy Posted June 15, 2005 Report Share Posted June 15, 2005 Simple question, do you believe that current prices will be maintained in the housing market or are we heading for a similar fall (like the crash from 1989 onwards)?Xiled.←No, they wont crash, hense the reason we have moved to Swindon as we were priced out of Bristol.Made £10,000 on our new house since December, they will just keep on rising. Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 15, 2005 Report Share Posted June 15, 2005 I believe that the bank of England will not let there be a crash and that house prices will continue to grow but at a far slower rate, he only reasonthey are struggling at the moment is the relatively (in comparison to recent times) interest rates. These were needed to try and curb excessive consumer spending and to bring the housing market back under control. Now that it is controlled, I can only see the rates lowering or being held at the very worst. I personally would buy as soon as you can afford it but there is no need to rush. For example, I will continue to rent for about another year as I save a deposit and watch my salary increase faster than house prices. I will be in a better position to buy then.←Still going up they've stopped and the lack of first time buyers will force homeowners to get real and drop their prices before the housing economy will fall flat on it's greedy face I'm going to save for e few more years and if no crash i'll save until their is,there is no way i'm going to pay £150,000 for a house that was worth £60,000 a few years ago,same house just a greedier owner,greedier agents and it'll go t*ts up like the last time,by which time i could have enough saved to pay cash to somebody desperate to get out like my mate at work did,he made a killing and got3 or 4 houses. Link to comment Share on other sites More sharing options...
Xiled Posted June 15, 2005 Author Report Share Posted June 15, 2005 Okay, so a few people think that things are going to stay pretty much constant.If you are bored of the (lack of) football chat, have a look at this discussion board:House Price Crash Web Site ForumThere appears to be a growing number of people who think we are heading for a major fall........ Link to comment Share on other sites More sharing options...
lukejones2 Posted June 15, 2005 Report Share Posted June 15, 2005 Still going up they've stopped and the lack of first time buyers will force homeowners to get real and drop their prices before the housing economy will fall flat on it's greedy face I'm going to save for e few more years and if no crash i'll save until their is,there is no way i'm going to pay £150,000 for a house that was worth £60,000 a few years ago,same house just a greedier owner,greedier agents and it'll go t*ts up like the last time,by which time i could have enough saved to pay cash to somebody desperate to get out like my mate at work did,he made a killing and got3 or 4 houses.←I would love for this to be the case... I cannot see the BoE letting it happen though. Time will tell! Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 15, 2005 Report Share Posted June 15, 2005 I would love for this to be the case... I cannot see the BoE letting it happen though. Time will tell!←happened before,will happen again If first time buyers refuse to buy something has to give way.I do the odd bit of extra work in people's homes doing rewires,plastering and general building/maintainence/repairs etc and i'm doing a rewire for first time buyers who has got stung big time Paid £150,000 for a two bed house in shirehampton which has subsidence,it was built on a 40 degree slope,every time i try to channel out the wall at the front of the house to sink a flush fit socket box 4 - 6 bricks fall out i see it all the time,no matter where i work,the state of houses brickwork/wiring/plumbing/timber are enough to put me off altogether even if they were £20,000avg.Why the hell is a house in the state of the one i'm working at worth up to 5 times as much now as to lets say 15 years ago when it needs gutting and starting again if only people knew what i've seen,they would be disgusted,even newer homes need checking over for dodgy wiring/DIY sparky's Link to comment Share on other sites More sharing options...
lukejones2 Posted June 15, 2005 Report Share Posted June 15, 2005 happened before,will happen again If first time buyers refuse to buy something has to give way.I do the odd bit of extra work in people's homes doing rewires,plastering and general building/maintainence/repairs etc and i'm doing a rewire for first time buyers who has got stung big time Paid £150,000 for a two bed house in shirehampton which has subsidence,it was built on a 40 degree slope,every time i try to channel out the wall at the front of the house to sink a flush fit socket box 4 - 6 bricks fall out i see it all the time,no matter where i work,the state of houses brickwork/wiring/plumbing/timber are enough to put me off altogether even if they were £20,000avg.Why the hell is a house in the state of the one i'm working at worth up to 5 times as much now as to lets say 15 years ago when it needs gutting and starting again if only people knew what i've seen,they would be disgusted,even newer homes need checking over for dodgy wiring/DIY sparky's ←Circumstances were severely different before, the BoE were not in control of the rates for a start and I think that this is an extremely largely contributory factor.I agree that something has to give if first time buyers aren't buying. That is why the government are beginning to try and assist first time buyers but, as stated above, the interest rates are what will give first I reckon.As for the first time buyers with subsidence.... It's all about getting your survey done properly!!! Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 15, 2005 Report Share Posted June 15, 2005 Circumstances were severely different before, the BoE were not in control of the rates for a start and I think that this is an extremely largely contributory factor.I agree that something has to give if first time buyers aren't buying. That is why the government are beginning to try and assist first time buyers but, as stated above, the interest rates are what will give first I reckon.As for the first time buyers with subsidence.... It's all about getting your survey done properly!!!←yes the government are trying to assist but you won't own All your home,the whole point of buying a house is to call it yours,not half yours/half theirs going on to subsidence,before we started digging out boxes it all looked very cosher but once you start digging away at walls/in attics properly it all starts to unfold and bingo,you've bought a lemon.don't think many people are going to share their home with our country's shifty leaders,i know i won't be,i could go out now and get my own place but i got this gut feeling i'm better off waiting and saving rather than rushing out now Link to comment Share on other sites More sharing options...
Guest WillsbridgeRed Posted June 16, 2005 Report Share Posted June 16, 2005 A sign of desperation from morguage lenders today.Major lenders are set to encourage first time buyers with %100 mortgauges AND deals set by PARENTS annual income.Maybe this will cause more people to buy homes or not, i do not know. But it certainly shows that demand just isnt there for traditional deals right now/. Link to comment Share on other sites More sharing options...
annanimo Posted June 16, 2005 Report Share Posted June 16, 2005 The Chancellor said pre-election he wants to help 1 million more people onto the property ladder. Bearing in mind he isn't going to build 1 million new houses, it would seem that demand is still high.I don't therefore think there will be a dramatic collapse in house prices unless there is a general downturn in the economy (as witnessed in the late 80s/early 90s). I personally wouldn't care less if there was, the whole property culture gets my back up a bit, and I don't earn enough to even consider buying a house. Prices have been infalted artificailly for far too long but few people object when they're making a lot of money out of it. However, the Bank of England is trying to bring some stability to the housing market, firstly because it doesn't want to see a return to "boom and bust" economics and secondly because it recognises the importance of first time buyers and doesn't want to price them out indefinitely.It will be interesting to see what happens. I don't know a great deal about economics but my concern is that, in 10 years or so, if things go on as they are there will be a definite social divide in this country between those people who own property and those who don't. Link to comment Share on other sites More sharing options...
zookeeper Posted June 16, 2005 Report Share Posted June 16, 2005 I would love for this to be the case... I cannot see the BoE letting it happen though. Time will tell!←It's all swings and round abouts in terms of the Bank of England. With peoples borrowing hitting huge figures they have had to increase the interest rates. If a downturn in the housing markets occurs or people think it will occur the interest rates will go down and borrowing up. Nasty cycle to get into. A small error can easily cause the bust boom cycle of previous times to come back.Also the housing market is also a speculative market. It is led by peoples opinions and if an increasing number of people believe that there could be a downturn in the market then they can cause it to happen. Or am I just hoping that all this will happen and one day I will own my own house. Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 16, 2005 Report Share Posted June 16, 2005 A sign of desperation from morguage lenders today.Major lenders are set to encourage first time buyers with %100 mortgauges AND deals set by PARENTS annual income.Maybe this will cause more people to buy homes or not, i do not know. But it certainly shows that demand just isnt there for traditional deals right now/.←100% morgage is suicide,a few percent increase in rates and your back on the housing list or taking up a second job to may your mahoosive repayment each month,got offered that once on $120,000 3 bed house in need of repair,6 months later i would be paying an extra £350.00 p/m on top of the £500.00 p/m it would've been at the start and that with 2 kids would not be affordable Link to comment Share on other sites More sharing options...
Xiled Posted June 16, 2005 Author Report Share Posted June 16, 2005 Circumstances were severely different before, the BoE were not in control of the rates for a start and I think that this is an extremely largely contributory factor.←When prices started to fall in 1988/1989, interest rates weren't much different from their current level.They shot up in 1992/1993 but by then many houses had already fallen by 50% from their previous peak value.The debt bubble is much greater this time. Some bad news on unemployment or a sniff of recession and the whole lot could come down like a house of cards.August might be the turning point. Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 16, 2005 Report Share Posted June 16, 2005 When prices started to fall in 1988/1989, interest rates weren't much different from their current level.They shot up in 1992/1993 but by then many houses had already fallen by 50% from their previous peak value.The debt bubble is much greater this time. Some bad news on unemployment or a sniff of recession and the whole lot could come down like a house of cards.August might be the turning point.←fingers well and truly crossed Link to comment Share on other sites More sharing options...
Dollymarie Posted June 16, 2005 Report Share Posted June 16, 2005 fingers well and truly crossed ←Mine too!My Andy Pandy works for a bank and he has been saying that the prices are going to drop before the end of the year.Dollymarie Link to comment Share on other sites More sharing options...
lukejones2 Posted June 17, 2005 Report Share Posted June 17, 2005 Mine too!My Andy Pandy works for a bank and he has been saying that the prices are going to drop before the end of the year.Dollymarie←Well, if a cartoon character working for the bank says so....Most of what other people have stated above is true, but the fact is that for a "bust" to occur, there would need to be an error in the setting of interest rates, or an unemployment increase. I cannot see either happening, really I can't.The difference between now and then as it were is that the BoE are now setting the interest rates!! The best thing that this government has done for the economy in my opinion (oh, and he complicated the tax legislation which is good for accountants ). I would suggest that a mistake is far less likely to occur under the current system. Link to comment Share on other sites More sharing options...
The Man In Black Posted June 17, 2005 Report Share Posted June 17, 2005 Most of what other people have stated above is true, but the fact is that for a "bust" to occur, there would need to be an error in the setting of interest rates, or an unemployment increase. I cannot see either happening, really I can't.←Why does it have to happen this way?People are paying over the top prices merely because they believe that houses are worth that much, or in the very least the prices aren't going to fall.However, we appear to have reached saturation point as the market is slowing down. As less and less people perceive a house as a good investment (me for one) then there is less demand.The buying chains break down as the person at the bottom can't sell their house and crash... down it comes.Sure, interest rates could screw things up, but don't forget that a market like this is built on speculation and perception... and speculative bubbles are always sure to pop at some point. Link to comment Share on other sites More sharing options...
Guest we8thegas Posted June 17, 2005 Report Share Posted June 17, 2005 Why does it have to happen this way?People are paying over the top prices merely because they believe that houses are worth that much, or in the very least the prices aren't going to fall.However, we appear to have reached saturation point as the market is slowing down. As less and less people perceive a house as a good investment (me for one) then there is less demand.The buying chains break down as the person at the bottom can't sell their house and crash... down it comes.Sure, interest rates could screw things up, but don't forget that a market like this is built on speculation and perception... and speculative bubbles are always sure to pop at some point.←first time buyers got to keep their wages in the bank and just refuse to pay obscene prices to these homeowners/property developers and not to budge which is starting to happen.no buyers means no market and to inspire me to buy they will have to come down to something more realistic. Link to comment Share on other sites More sharing options...
annanimo Posted June 17, 2005 Report Share Posted June 17, 2005 Yes, you're right: it's about supply and demand. If there wasn't a demand people couldn't charge these crazy prices. The thing is, we are living in a "property culture" where owning a house is seen as being the "be all and end all" - you only have to watch all these awful TV shows to see that. 25 years ago about 46% of people owned their property - today the figure is around 73% (figures from a recent C4 documentary). A lot of people think that if they don't buy now they may never get the chance and this of course keeps demand high. I know some people who are willing to take huge financial risks to "get on the property ladder" because they are terrified of not being able to.It's not the house they are buying - they are buying into the "property culture" and this whole idea that owning your house is super-significant. Which is why we have the inflated prices. It's not about bricks and mortar but what it represents to people's aspirations.Demand is the product of our increasingly materialistic society and as such is unlikely to subside imminently. I personally would like to see a downturn in the property economy but too many people would be set to lose so much that I can't see the government or the BoE to allow it happening. Link to comment Share on other sites More sharing options...
lukejones2 Posted June 17, 2005 Report Share Posted June 17, 2005 Its true that it is about supply and demand... with the recent slow downs, the BoE will lower interest rates making mortgages more affordable and therefore increasing demand. Thats why it has to happen this way MIB... The idea was for the BoE to ensure that the property prices (among other things) don't grow as quickly as they have been doing. They have succeeded and house price growth has slowed down to a reasonable level. Small rises in some areas and even small drops in others equating to a slower growth. The minute there is a risk of the prices falling (which could cause panic and recession) then those interest rates will come back down.We may think that we have the power to control it but really we don't because no matter what our principles (I agree - lets all keep our money in our pockets until its sensible...) the majority of the western world have a capitalist outlook and will take action to ensure that they make the best decision for them financially in there eyes. Interest rates go down, people get excited, people buy houses... We are all puppets of consumerism....Incidentally, I am one of these people who will buy when the circumstances are right for me. I can get a 5 times salary 120% mortgage!! How disgusting is that!! Cant remember which provider it is but when my salary rise slows down is when I intend to buy. Hopefully by then I will be able to get a 110% 4 times salary mortgage. This would sort me out! Link to comment Share on other sites More sharing options...
The Man In Black Posted June 17, 2005 Report Share Posted June 17, 2005 It winds me up though when people talk about 'throwing money away' on renting.I'm with most of you guys, it just isn't sensible buying now.When me and my partner announced our engagement, her parents told us not to get married, and instead they would pay for the deposit on our first house.I argued the point that beside me needing flexibility to move with my job, why spend £700 a month on a mortgage where I'm just chasing interest.And if/when the market crashes I wipe out any equity that I have built up.And the best thing? Pay £500 a month and get a good rented property, and if the roof falls off/drains block/brick work needs some TLC/guttering needs clearing/heating goes/wiring needs doing/tiling needs to be done etc. the landlord has to pay for it. And if the area goes downhill or the new neighbours are a pain I can up and leave.Until a mortgage for me is more viable and actually does build up equity I'm staying put and renting.To me, you're throwing your money away on a mortgage, not renting. But has been said, some people think you have to own a property as a right of passage and a status symbol. Link to comment Share on other sites More sharing options...
Gerry Gows' Tash Posted June 17, 2005 Report Share Posted June 17, 2005 Simple question, do you believe that current prices will be maintained in the housing market or are we heading for a similar fall (like the crash from 1989 onwards)?Xiled.←I wish I knew - due to getting divorced I'm on the point of selling my old house - can't complain as I've made an ok profit as a potential deposit for my next place - although being down to only one income my options are fairly limited even then. If It does crash I'd be better off sticking that in the bank and renting until prices to bottom out - but if they don't I could find myself left behind while the my purchasing power dwindles. I'm also quite fussy and want to live withing walking distance of the Gate ! I do feel sorry for first time buyers but I don't think it's any worse than it's ever been - unless you are on a very good salary you have needed 2 reasonable incomes for an entry level home since the early 1980sTo ansewer your question the smart money seems to be on a gentle "correction" this year and next with the market having a soft landing round about the end of 2006.I should add that I lost quite a bit of money in the property crash of the early 90's, ok the circustances were different but no one had predicted it then either ! Link to comment Share on other sites More sharing options...
claloudav Posted June 17, 2005 Report Share Posted June 17, 2005 Hopefully they won;t be to bad. Sorry to get on your nerves Rob, but I would rather put money into a first time buyers scheme (pay 100 quid move in then pay a fixed amount per month towards a mortgage) than pay rent. I hope to get on the property ladder by the time I am earning a steady income within the next few years and plan ahead to ensure a successful future. I can only hope the house prices don't get to extreme otherwise I will be driven out of Bristol to god knows where. Link to comment Share on other sites More sharing options...
The Man In Black Posted June 17, 2005 Report Share Posted June 17, 2005 Sorry to get on your nerves Rob, ←You're too apologetic Clare, you know that? but I would rather put money into a first time buyers scheme (pay 100 quid move in then pay a fixed amount per month towards a mortgage) than pay rent. I hope to get on the property ladder by the time I am earning a steady income within the next few years and plan ahead to ensure a successful future. I can only hope the house prices don't get to extreme otherwise I will be driven out of Bristol to god knows where.←But is it so much a property ladder as a property noose?If prices crashed you could be left paying off a very expensive looking mortgage.And bare in mind that many new homes look more like cupboards, are built on flood plains and pretty much made of cardboard.Just be careful out there in the housing market As for moving away from Bristol, all I can advise is keep your mind open - if you want a successful future it might be elsewhere... look at me, I ended up in Swindon Link to comment Share on other sites More sharing options...
Guest Mrs Cityboy Posted June 17, 2005 Report Share Posted June 17, 2005 You're too apologetic Clare, you know that? But is it so much a property ladder as a property noose?If prices crashed you could be left paying off a very expensive looking mortgage.And bare in mind that many new homes look more like cupboards, are built on flood plains and pretty much made of cardboard.Just be careful out there in the housing market As for moving away from Bristol, all I can advise is keep your mind open - if you want a successful future it might be elsewhere... look at me, I ended up in Swindon ←Me too. Swindon is the new Bristol. Link to comment Share on other sites More sharing options...
The Man In Black Posted June 17, 2005 Report Share Posted June 17, 2005 Me too. Swindon is the new Bristol. ←Dunno about that Besides, I'll be back in good ol' Bristol next month..... although just to warn you, I might take the Magic Roundabout with me, else I might get withdrawal symptoms... Link to comment Share on other sites More sharing options...
lukejones2 Posted June 18, 2005 Report Share Posted June 18, 2005 When me and my partner announced our engagement, her parents told us not to get married←So they are really pleased for you then Inlaws eh!!! Link to comment Share on other sites More sharing options...
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