Monday, Oct 29, 2007
Its all going Pete Tong - even Savills now agree!
The Times: House price gloom as wealthy turn away
Looks like the housing market will now have to rely on the Northern Ireland figures to pull it along now even high end London is faltering, LOL.
Posted by andyh @ 04:55 AM (343 views) Add Comment
8 Comments
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1. Mgr said...
Rely on Northern Ireland?? Ha ha! NI housing market is in VERY severe trouble. It will just take a bit of time to come through in the figures.
2. Flapjack said...
Oh dear some of the bulls are upset! Interesting comments - 'property prices only go up' etc. Some people are in for a real shock. Should be interesting time ahead!
3. Wdbeast said...
Hi HPCers,
I have been reading this blog for the last nine months with increasing interest as I have become convinced that you are right in forecasting a severe property price correction.
I live in rented accommodation in the East Midlands with a young family and I would appreciate anyone's thoughts on how long it is likely to be before it would be wise to consider buying a home for my family, as I need to make a decision shortly over the length of lease I should sign next.
Your honest appraisals would be appreciated
4. S2rjuly07 said...
Wdbeast, personally I don't expect it to become a good time to buy for a number of years; two at the very least. We have just extended our lease having sold to rent earlier in the year. I would have extended for a year, but 6 months was a compromise with my wife. In the last crash it took at least 5-6 years before the market started to pick up again. There are too many factors that remain uncertain. For example will the BoE cop out and go for high inflation to get us out of the HPI mess or, more sensibly in my opinion, increase interest rates to keep inflation at bay. Obviously I am a VI in this respect as I want high interest and low inflation to grow the capital we released.
5. dohousescrashinthewoods said...
Great to see this on the front page of the print version.
6. dohousescrashinthewoods said...
Wdbeast, 4 years (2012) seems to have some weight, but don't expect prices to rise for another decade after that - houses are likely to be homes for quite some time.
The other way to do it is wait until average price falls below 3xSalary. It's likely to keep falling after that, but at least you will have bought in at "fair value". It went a lot higher than anyone imagined, so it is likely to go a lot lower than anyone imagined either.
7. wiltshire said...
Wdbeast, I am of the opinion the first 2-3 (maybe 4) years could see jaw-dropping price drops.
I feel that we're facing almost a perfect storm - the biggest housing bubble ever where prices have lost touch with any fundamental measure, we're £1.5trillion in debt, the cheap credit tap has been shut off, inflation (food inflation, oil prices, imported goods inflation) is about to skyrocket, Northern Rock will be the first of the high street 'scares', no-one trusts the government anymore, the BTL herd are about to stampede and as far as the media is concerned the housing cat is now well and truly out of the bag (and so from here on the headlines will get more and more sensational).
All of these issues are extremely acute and all are coming to fruit at exactly the same time and with us being in the age of 24 hour immediate information pretty much everyone is going to realise the extent of the problem at exactly the same time (apart from those who've been visiting here for some time and could sense the way the wind was blowing). I think the housing market will probably fall off a cliff rather than a long slow drawn-out death. The various figures released today are pretty shocking (new mortgages down 20%!!!), they don't take into account the change in climate since Northern Rock and are probably going to increase dramatically with each month/quarter from here on in. I could be wrong but I've said before I think we could be about to see a bust of historic proportions.
8. Wdbeast said...
Many thanks for your advice