Remember 1992 – 1995

[Justice]

Too me what kicked things off was BTL and that was fuled by all the immigrants being let in to the UK

Not only did this push house prices up but it kept wages down.

[steve99]

Maybe I have been very, very lucky, but this was not my experience at all.

I dropped out of an engineering course at FE college in 1992 when I started a small technical business, then started doing contract work around 1993. There was no shortage of work and I earned well by working lots of hours. By 1995 I had a company car and was earning significantly more £K than my age (as I have done ever since). So I was able to buy a 3 bed house for £77k by early 1998, when most of my old school mates were just starting out after Uni.

And I do remeber very well having seen house prices going down, down and down; my first thought at the time being that I had to get on the ladder before they went too far back up.

If at the time you were in the right business or job, you were in the best position ever to set your self up, as you say cheap property (and that doesn't come about on account of booming employment levels) I actually knew a couple of people who got rich big time out of the last recession however, I know more people who were out of work and others loosing their houses (both in the UK and in Australia) Some people were completely oblivious to the fact that there was a recession, eg brother in law doing hairdressing for TV/Film production, or another with a big contract supplying computers to government departments. But for the average bod back then, getting and keeping a job and by extension, keeping your house, was a painful business

[CharlieChuck]

I was Uni of Kent during some of the last crash, it's based in canterbury but I lived in whitstable for the most of it. At the time whitstable was a very run down area, there were no jobs in the area, had a very high level of unemployment and there was EEC funding for new businesses or businesses that relocated there. I can remember waiting in the queue for a bank, the bank manager was talking to some women in the queue and he seemed to say to everyone of them "has your husband found a job yet".

These houses sold for about £24,000 in 1992, but no one had a job or the money to buy them. The average wage for anyone working in what few jobs there were would have been about 6-7,000 a year. We used to rent a similar one for about £450pm, which spread over 5 people in 4 bedrooms was about the normal rent per room then. I know the area has become a trendy second home port for londoners, which in turn has created jobs in the area, but the increase in 15 years is a massive 9 times.

http://www.rightmove.co.uk/viewdetails-205...16&tr_t=buy

[ukdaasfan]

I disagree! These houses were in streets full of boarded up houses! no prospects! getting vandalised/burgled/burnt out quite regularly!I recall visiting such an area years ago! weren't worth a penny in my book! Way too much hassle, especially as an investment option! I'm still hoping someone can answer my question, where are all these undesirables now the houses have 'value'? If they are now acceptable/improved neighbourhoods, Nulabour have indeed bought about social change........and should be credited!

OK...I guessign most of this was North of Watford.

Cuase I lived through the last on In Guildford and remember a few people (mainly Estate Agents Ironically enough!) losing there jobs and there houses. The crash was exacerbated by large numbers of people losing there jobs.

This is not so much of an issue. Especially with all the poles going home. We are pretty desperate for staff at present.

Plus I have at least 15 friends how have been waiting for teh crash and have huge deposits. Most are waiting for about 15% drop and then will then start looking. Theres cash around....in 1992 there wasn't.

[PotNoodle]

Up until the BTL mob steamed in, you could buy a terraced house in certain pubs in Burnley for around about the £50 mark.

Ah, the good old days.....

Tha's noothin'.

When Ah were a lad, Me Dad was paid £8,000 to take a house,

which were joost a hole in the ground beside a cesspit.....

etc etc a la Python.

[Roman Roady]

Bump for the best thread on the site IMHO

Check out the posts by Serpico on the following pages (starting on page 2 I think) about his rise and fall a few years ago. Sorry for the longer term members who have seen it before.

Happy reading.

[Guest Steve Cook]

Many posters will be too young to remember the state of the housing market in this period, others may have forgot.

Obviously houses were cheaper! – most people are aware that typically prices are 3x what they were back then – but that’s not the whole story.

When prices hit rock bottom the bottom end of the market suffered most, prices were so low in parts of the north that even a full time position at MacDonald’s would be sufficient to get a mortgage (3x wage – single person) for a nice clean 2 bed terrace in a decent area, in fact you’d be spoilt for choice, and it would cost about the same as renting a smelly one bed flat in a drug infested council tower block.

But what about the other end of town – the inner city back to backs the ex council houses…

Well, simply no one wanted them, (anyone could get a mortgage for a decent place in a decent part of town) prices fell through the floor, houses were abandoned (yes abandoned) as owners could not sell and weren’t prepared to live in an area that had been taken over by the vandals, junkies and salvage mobs (gangs who would strip empty properties and sell roof slates, boilers, radiators even windows on the black market)

Estate agents were full of houses in the £15,000 to £25,000 range (good house – bad area)

Lots of houses that needed a bit of work £10,000 to £15,000 (poor house – bad area)

And if you went to auction, well…under £10,000 was very common, and for the places that had the vandal/ salvage mob “treatment” £1,000 to £5,000 was about right.

(it was even possible to buy a house for a grand AND loose a fortune).

Many of you will doubt me – I know

But mark my words, it happened – a saw it with my own eyes.

Obviously these houses HAD been worth more in the late eighties in the boom.

Many of these areas are NOW seen as “trendy” or “up and coming”

If you are thinking of buying now…. Do try to stay away from the very bottom end of the market particularly in the north.

All of the above is accurate. I come from the north. My family still ive in the north east. In places like Redcar and Middlesbrough you could buy a house for well under 10k with little wrong with it.

In certain parts, you could get them for 5k

Edited October 2, 2008 by Steve Cook

[Guest Steve Cook]

The 90's was mild in historical terms - a soft landing.

What we're heading for us much worse.

Just saying...

yes

Much worse....

worse than anything in living memory

I think what is coming will make the 30s look like an aperitif to the main course.

[Badger]

Yep I bought my first property - a large studio flat at 7 dials Brighton for £25K. About twice my earnings at the time Shame I sold it in 2001

Still, never mind eh!

[Darkman]

Now for some BULL sentiment

That's why I don't think it will get that bad again. We may have a crash/correction, but houses going for < £10K? I think they will be hoovered up by investors with their eye on the long-term, long before they reach that price.

I'd consider buying a property for around that sum, not to own a house, but to own land with planning permission. It would be a strictly long term investment i.e. ten years.

This is certainly a crash, but anyone who believes there won't be another bubble is a fool.

[Converted Lurker]

Bump for the best thread on the site IMHO

Check out the posts by Serpico on the following pages (starting on page 2 I think) about his rise and fall a few years ago. Sorry for the longer term members who have seen it before.

Happy reading.

Nice one, was thinking of The Serpico Post when watching some of my contacts car sales businesses dying recently. Some of these guys have been in the game men and boys and suddenly, I mean real suddenly, they can't sell a car, havn't even opened the door on some cars for months. Strange times...

[Guest Shedfish]

thanks for bumping this RR. more wisdom in a paragraph from Serpico than 11 years of Brown & Bliar's supreme soviet

[Garry AKA Pod]

thanks for bumping this RR. more wisdom in a paragraph from Serpico than 11 years of Brown & Bliar's supreme soviet

Here here. I remember reading this thread almost 2 years ago and thought Serpico's posts were fantastic. I hope he's still "with us".

[Jadoube]

One thing I remember about the last recession was the absolute lack of jobs, even McJobs, for school leavers. I had three A Levels but couldn't get any work. The Job Centre occasionally came up with odd jobs for a day or two, things like unloading lorries, and I'd cycle all over north London to odd little warehouses to work with an assortment of very young men and men in their 40s-50s. Sort of like an unemployed version of Dad's Army.

It got quite depressing as there was usually some reason why people wouldn't take the work. I got offered one day's labouring on a building site for £30, but had to have steel toecap boots, which cost....you guessed it, £30! The dole office wouldn't put me forward for a lot of manual jobs because they said I was 'overqualified'. I pointed out there weren't any other jobs so what was I supposed to do!

I remember the early 90's - having to make a lot of friends redundant. No fun I assure you. Same thing happened last Monday. Its not just house prices that go in cycles.

[erranta]

Many posters will be too young to remember the state of the housing market in this period, others may have forgot.

Obviously houses were cheaper! – most people are aware that typically prices are 3x what they were back then – but that's not the whole story.

When prices hit rock bottom the bottom end of the market suffered most, prices were so low in parts of the north that even a full time position at MacDonald's would be sufficient to get a mortgage (3x wage – single person) for a nice clean 2 bed terrace in a decent area, in fact you'd be spoilt for choice, and it would cost about the same as renting a smelly one bed flat in a drug infested council tower block.

But what about the other end of town – the inner city back to backs the ex council houses…

Well, simply no one wanted them, (anyone could get a mortgage for a decent place in a decent part of town) prices fell through the floor, houses were abandoned (yes abandoned) as owners could not sell and weren't prepared to live in an area that had been taken over by the vandals, junkies and salvage mobs (gangs who would strip empty properties and sell roof slates, boilers, radiators even windows on the black market)

Estate agents were full of houses in the £15,000 to £25,000 range (good house – bad area)

Lots of houses that needed a bit of work £10,000 to £15,000 (poor house – bad area)

And if you went to auction, well…under £10,000 was very common, and for the places that had the vandal/ salvage mob "treatment" £1,000 to £5,000 was about right.

(it was even possible to buy a house for a grand AND loose a fortune).

Many of you will doubt me – I know

But mark my words, it happened – a saw it with my own eyes.

Obviously these houses HAD been worth more in the late eighties in the boom.

Many of these areas are NOW seen as "trendy" or "up and coming"

If you are thinking of buying now…. Do try to stay away from the very bottom end of the market particularly in the north.

Doccyboy

Above has proof of what I posted on another recent thread

that I remembered many Northern towns having "Buy one get one Free" - for a £1,000 2 up/down terraces (not even in auctions)

[Concrete Jungle]

Up until the BTL mob steamed in, you could buy a terraced house in certain pubs in Burnley for around about the £50 mark.

Ah, the good old days.....

Eee them was the days £45 a pint or two of mild and a bag of pork scratchings.

[Guest Steve Cook]

Many posters will be too young to remember the state of the housing market in this period, others may have forgot.

Obviously houses were cheaper! – most people are aware that typically prices are 3x what they were back then – but that's not the whole story.

When prices hit rock bottom the bottom end of the market suffered most, prices were so low in parts of the north that even a full time position at MacDonald's would be sufficient to get a mortgage (3x  wage – single person) for a nice clean 2 bed terrace in a decent area, in fact you'd be spoilt for choice, and it would cost about the same as renting a smelly one bed flat in a drug infested council tower block.

But what about the other end of town – the inner city back to backs the ex council houses…

Well, simply no one wanted them, (anyone could get a mortgage for a decent place in a decent part of town) prices fell through the floor, houses were abandoned (yes abandoned) as owners could not sell and weren't prepared to live in an area that had been taken over by the vandals, junkies and salvage mobs (gangs who would strip empty properties and sell roof slates, boilers, radiators even windows on the black market)

Estate agents were full of houses in the £15,000 to £25,000 range (good house – bad area)

Lots of houses that needed a bit of work £10,000 to £15,000 (poor house – bad area)

And if you went to auction, well…under £10,000 was very common, and for the places that had the vandal/ salvage mob "treatment" £1,000 to £5,000 was about right.

(it was even possible to buy a house for a grand AND loose a fortune).

Many of you will doubt me – I know

But mark my words, it happened – a saw it with my own eyes.

Obviously these houses HAD been worth more in the late eighties in the boom.

Many of these areas are NOW seen as "trendy" or "up and coming"

If you are thinking of buying now…. Do try to stay away from the very bottom end of the market particularly in the north.

I don't doubt you at all. I come from the north east and properties were changing hands for under 10k. These were 2 up 2 down terraced houses with nothing essentially wrong with them. This was the case right up to 1995

[erranta]

yes - I started looking for Serpico's posts but there was just so many interesting anecdotes for younger posters who didn't live through the last recession I thought it was worth bumping.

I can do better > Here's a 50p a house thread!

Houses in the North & whole steets in Manchester were sold for 50p a house - now worth hundred thousand+ done-up!

http://www.housepricecrash.co.uk/forum/index.php?showtopic=40109&st=0&p=520835entry520835

[assetrichcashpoor]

I disagree! These houses were in streets full of boarded up houses! no prospects! getting vandalised/burgled/burnt out quite regularly!I recall visiting such an area years ago! weren't worth a penny in my book! Way too much hassle, especially as an investment option! I'm still hoping someone can answer my question, where are all these undesirables now the houses have 'value'? If they are now acceptable/improved neighbourhoods, Nulabour have indeed bought about social change........and should be credited!

They're still shit holes. Just expensive shit holes now.

I used to live in Manchester. Before I moved up there in 2003 I was considering buying a 3 bed terrace on the edge of Rusholme, near moss side. That was £70k. When I left in 2005 similar houses in that area were going for £110k, and I think they're still around that mark now having gnoe up and then down. I still wouldn't want to live there for an extended period of time. The place where I rented had bars on the downstairs windows and had been robbed several times. Someone was shot in a park behind my old house about a year after I'd left manchester. I wouldn't feel comfortable leaving my car there now.

If you take what I consider to be historic house financing with a mortgage, i.e. 10% deposit + 3x annual salary, then for £110k house you'd need a deposit of £11k, and to borrow £99k for a mortgage which would mean you'd need an annual salary of £33k. I don't know many people living in Moss side that earn that much.

Even with looser mortgage criteria, such as 5% deposit and 4 x annual salary that would still need someone to be earning £26k.

Moss side has changed recently there are a lot more former students who have moved in the less desirable areas, however not enough of them have moved to change the areas entirely, and in my opinion there is not much mixing between the traditional inhabitants and the newer arrivals. I see a lot of islands of new blocks of flats that look like they've been decorated entirely at IKEA and have gated car parks, amongst the older terraced housing. The traditional residents some of whom may have been behind a lot of crime in the area are either still there and behaving the same or have been moved furthur out to places like Wythenshaw and are behaving the same.

On paper it might look like Moss side has 'improved' but the underlying social problems are still exist, although they may have been transferred to other areas.

[awaytogo]

I'm bumping this old thread which I have re-read and found it had a lot of personal anecdotes about the last recession. Many new posters will not have had the chance to read it and might find the anecdotes interesting.

If you don't want to read it all then ok it will just fall off the first page again and go back into obscurity.

I remember a friend buying in 1990 and his property price dropped and did not regain the purchase price untill almost 2000.

[Tiger Woods?]

I'm bumping this old thread which I have re-read and found it had a lot of personal anecdotes about the last recession. Many new posters will not have had the chance to read it and might find the anecdotes interesting.

If you don't want to read it all then ok it will just fall off the first page again and go back into obscurity.

I urge everyone to read Serpico's post on this thread, and any others you can find by him. Very interesting.

[ruthyk]

I urge everyone to read Serpico's post on this thread, and any others you can find by him. Very interesting.

seconded

I bought my first house in Whitley Bay in 1995 at the age of 25. I was a trainee solicitor earning 12k, and bought a 3 bed terrace for 41k. My deposit was 5%. Those same houses now sell for 180k!! Post crash!! at the height they were going for 200 plus.

Prices here are just unsustainable long term. If i was a trainee solicitor now id be earning 18k, so with a 5% deposit i could afford a 1 bed flat in Cowgate.....

Personally, we sold our big 3 bed semi in feb, same area, now buying a smaller 3 bed semi in south wellfield, much cheaper, HUGE garden, needs doing up, but still paying 160k.. but its the house we want to stay in, and as we are both approaching 40, and want to garden weve decided that a 80k mortgage is fine. I personally would like to see prices come down a LOT. I want my daughter and grandson to have the same choices and opportunities. It matters not a jot to me whether my house is worth more or less, im going to live there for another 20 years.

Ill still be logging on here, i still would like to see big drops. i hope they will happen

[Mikhail Liebenstein]

I started on £17,600 fresh from uni in 1995 and I remember Harbinder buying a 3 bed semi with garage and garden for £54,000 - okay, not in the nicest of areas but not in a bad area either, obviously a starter home.

How many could afford that type of house now?

(and, paradoxically, the population of the North East is is now lower than what it was ten years ago! (3.5% drop from 1991 to 2001 census))

You were on about the same starting salary as I was in 1996, though in the South East that wouldn't have bought anything decent at that time, studio flats we £60k even back then.

[Guest_FaFa!_*]

Giving this a gentle bump! Many thanks to those who contributed and who are still around, I thoroughly recommend reading the whole thread. I was born at the end of the seventies so I do remember the last recession, but only in terms of my kiddie building society account having 10%+ interest. I was very excited by that, as the yearly interest alone could cover the purchase of one, if not two, computer games. The only other thing I really remember is a megabucks stockbroker my parents knew having to do a runner to the US (dual citizenship, IIRC). Presumably some overleveraged plays went the wrong way.

[Shmoo]

I haven't read the whole of this threat, but I believe that the current situation is different than anything that has come before.

From personal experience, if you are looking to buy a house under £350k in a decent area, where people my age (25 - 35) want to live, you are competing with baby boomers looking to buy a place to rent out. For every one person genuinely looking to buy to live, I would estimate there's two looking to buy to rent.

From what I've read, this wasn't the case in the past. I'd be interested to see if that's the opinion of those on here who bought in decades gone by.

If this is true then, even when relative interest in buying is low, it will still be higher than decades gone by.

Unless this additional interest is nullified, either by tax on second homes, a change in attitude to buying to rent or a marked rise in interest rates, this will not change and will keep prices high.