Tuesday, Jan 02, 2007
Could we see a flood of 'bad news' headlines in Jan?
Telegraph: Overvalued house prices threaten crash
House prices are at their most overvalued for 15 years, new figures showed yesterday, as hard-pressed home-owners struggle to pay their mortgages.
And with the gloomy prospect of a record tax burden and unprecedented rises in household bills comes a warning that interest rates could rise by far more than expected.
Morgan Stanley and PriceWaterhouseCoopers warn there is a high chance of a severe fall in house prices in the coming years
A study commissioned by The Daily Telegraph shows that house prices are moving well beyond the reach of many families as the rapid growth in property values outpaces increases in incomes.
Posted by tyrellcorporation @ 10:26 AM (155 views) Add Comment
9 Comments
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1. sold 2 rent 1 said...
This is the graph that is now at 94.3 point
http://www.telegraph.co.uk/money/graphics/2006/10/02/cnhouse02big.gif
2. sold 2 rent 1 said...
Based on the 33 year cycle theory I reckon the index will bottom at 80 points like in 1976. (se graph)
http://www.telegraph.co.uk/money/graphics/2006/10/02/cnhouse02big.gif
The index won't need to get below 60 like in the crash of 1992
2007 prices peak
2008 small price falls
2009 IR peaks. index hits bottom around 80 points. House prices in free fall.
2010 or 2011 time to buy (if you have a job and can afford the IR)
3. tyrellcorporation said...
I guess we can take comfort that it's hovering around the right sort of zone. Still a fair way off the pain zone though...
4. tyrellcorporation said...
I need to move at the mo and three 4 bed town houses came up in the right area over Christmas - joy to me as I've just played one off against the other and got one down to 950 a month. To buy this property would cost me about 320,000.
I really can't complain at that.
5. tyrellcorporation said...
Risk free, cheap living that leaves me able to move anywhere within a month - something a homeowner can only dream of... We may not see HPC in 2007 but the intense competition between landlords must be making the pips squeek by now!
5.25% by Feb is odds on and with CPI edging towards 3% the BoE will be getting the willies and some MPC hawks may even press for a 0.5% hike to 'send a message'.
6. Taffe said...
I am renting a 5 bedroom detached cottage with paddock in exmoor for £1000 per month....would cost me £500-£700,000
marvellous
7. Blueangel said...
This is on the front page but the headline is something like "House prices at their most overvalued for 15 years" No "crash" word.
8. David20040_0 said...
Don't hold your breath lads, the Telegraph predicted a house price crash last year and it was wrong.
There is no real indication that interest rates will rise as high as 6%. Many economists believe they have now peaked.
The article also states that it believes a bubble will start to be created in 2008, indicating that house prices at present are at a sustainable level.
Romania and Bulgaria have just joined the EU, if 250K arrive here then BTL investors will make even more money and put further strain on the market increasing prices.
But wouldn't it be excellent if they do drop :)
9. Scunnered said...
"The Bank could risk finally spawning a house price bubble in 2008," [a Lombard Street Economist] said.
!!!!!!!!!!!!!!!!!!!!!!!!