Tuesday, Sep 18, 2007
"Nesting, not profit, key driver in home ownership"
Google: News
Sure, tell the BTLers, who will crash this market by Thanksgiving... are 88% of home owners ready to sink with the ship? and how about the "life in debt" that they will face?
Posted by confused76 @ 03:38 PM (784 views) Add Comment
9 Comments
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1. whiteknight said...
Excuse me for a moment. My B.S. ometer is ringing.
Those that ARE IN THE POSITION to decide may not sell up. However, they won't be able to MEW and they might have to worry they will have no money a bit later on when they stop work.
If they had to move to get a new job (this debacle has assasinated workforce mobility by the way) they might find they have a few problems.
2. confused76 said...
The country economy is at the ransom of:
- btl speculators (leaches!)
- questionable financial wizards
- russian criminals
- estate agents
- oil money
thank you Gordon
3. dugmug said...
1) studies have shown that consumer attitudes are heavily influenced by trends of the recent past rather than an knowledge of underlying causes or long-term trends - consumers are dumb, not to put too fine a point on it.
2) even despite this, 71% already recognise the boom could be over - the message is starting to get through.
3) even just a few months ago, 99% of newspaper copy was still predicting HPI to continue at 10%+ ; things are changing fast.
One of the links from the page above is a particularly dumb: http://uk.reuters.com/article/personalFinanceNews/idUKNOA84201720070918?pageNumber=1
"The research also found that nesting is the key motivation in home ownership, as opposed to capital gain. Some 77 percent of respondents were buying a home to live in and the primary motivation for almost 90 percent of them was that they wanted to own a property."
Who were the 10% of people buying a property for whom owning a property was not there main motivation?? "I want to buy a property, but not because I want to own one!" And if 77% were buying a home to live in (let's not get into how it can be a "home" if you're not going ot live in it!) that means 23% speculators.
"Making money from property purchase was important to less than half of those questioned." The figure was actually 45% I saw elsewhere. So only 45% think that having HPI is important - housing market seems more stable already! :-)
"The report also showed that, even if there were a 15 percent drop in house prices, just 2 percent of homeowners would sell up immediately. Instead, 63 percent would retain ownership of their property indefinitely and 11 percent would keep the property with a view to selling once prices recovered."
For some of these people - new entrants and those MEW'd to the eyeballs - it isn't a case they won't WANT to sell as much as a case they won't BE ABLE to sell, because they'll be in negative equity if prices drop 15%. Anyway, this is stating the bleeding obvious in the extreme - by the time prices have already gone down 15% of course it's too late to sell up unless you have to!
4. dugmug said...
AND another thing...in the event of a 15% drop, 2% sell up, 63% stay put indefinitely, 11% wait and sell when (if) the market recovers - that's a total of 76%, what about the other 24%?? Did they tick the boxes for "Don't know?" or "I'll have been repossed by then anyway"? 24% floating voters and they they try to make out this shows the market to be solid - ha ha, see you at the austions.
5. dugmug said...
AND another thing...in the event of a 15% drop, 2% sell up, 63% stay put indefinitely, 11% wait and sell when (if) the market recovers - that's a total of 76%, what about the other 24%?? Did they tick the boxes for "Don't know?" or "I'll have been repossed by then anyway"? 24% floating voters and they they try to make out this shows the market to be solid - ha ha, see you at the auctions.
6. nacho99 said...
LOL, The last crash was not caused by people CHOOSING to sell because prices were falling so it does not matter.
Can someone tell me what the point of the survey was?
7. Drewster said...
People say they prefer nesting to profit, but anecdotally most people who buy now are doing so to "get on the ladder before it's too late". So although the prime reason is still "nesting", these same people might have happily continued to live with mum'n'dad if it runaway prices hadn't pushed them onto the market sooner.
8. inbreda said...
Nacho99 - they had to conduct a survey as it is the last means by which they can find anything positive to talk about. The "real" numbers are all just so negative at the moment that they have to be avoided at all costs.
9. captain sensible said...
We are frequently told that BTLs are in it for the long term and won't sell even if prices fall. The only 3 people I know who had savings in NR paniced and waited in line for hours to get their savings out even though they were well under the max £35k protected limit and so stood at most to lose a couple of grand each if NR went under. Yet, a BTL investor with a million pound portfolio is going to stand fast and watch whilst 20k is wiped off his/her notional nest egg every time the market drops by another 2% (less than the fall in asking prices reported by Rightmove last month). I don't think so. I suspect that plenty of the people who respond to surveys of this type say that they are sticking with their investment just to persuade other mugs to stay in the game whilst they desperately try to get out before the major price drops hit.