Friday, Dec 14, 2007
Savills say that London prices will go down more than 10%
ThisIsMoney: London housing hotspots to see prices fall
... and if Savills say that, the truth is probably -20%. "Flats are particularly vulnerable to a sharp fall in value and properties in fringe areas that joined the housing boom late will be among the first to suffer"... and guess what "Meanwhile, investors are no longer convinced property is a good way to make money" no kidding! ...and "just £2bn of City bonus money is expected to be ploughed into bricks and mortar this coming year compared with £5bn in the past year" a nice 60% less. 'The gentrification of London is like the tide,' said Barnes. 'It comes in and goes out but when it comes in it gets a little bit bigger each time.' in the meanwhile you could go bankrupt, but keep smiling
Posted by confused76 @ 03:57 PM (1449 views) Add Comment
16 Comments
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1. jack c said...
Confused76 - here is an article sent to me today via Mortgage Strategy publication which I reckon will bring a huge Friday aftrenoon laugh from yourself !
"Property for Life reports that almost 70% of investors feel that now is a good time to purchase property. Similarly, the Association of Rental and Letting Agents Q3 Review and Index reported that more than half of all buy-to-let investors are expecting to expand their portfolios in the next 12 months. Property for life says experienced landlords have the protection of a strong portfolio behind them. Seasoned investors will have acquired equity which will enable them to ride out any difficult times.The company also says the good credit rating of both groups also makes them attractive to lenders allowing them to capitalise on competitive deals from developers.David Austin, managing director of Property for Life, says: “Investors who are serious about long-term investment and who already have a number of properties behind them can really benefit from the current climate. Property for Life says that the latest interest rate cut and rates being historically low, expected to fall further next year are consistent with survey results that indicate almost 70% of investors still have a desire to buy. Austin adds: ”One of the best options for investors is diversification. Seasoned investors should diversify on area, type of property and tenant thus widening their portfolio and protecting against risk. Experienced landlords keep the long term picture in mind, wisely investing in areas where rental yields are greater and with fewer void periods. The combination of diversification and research is the key to a strong portfolio.”
2. Realist said...
I think Yolande should be renamed Yoyo. She really is a hoot. Only a matter of 6 months ago she was talking about how BTL landlords were in it for the long term and forecasting large year on year increases in house prices particularly in her beloved "City State" of London.
No doubt she will blame it all on HIPS, credit crunch, northern rock and anything else to justify why her forecasts were all hot air.
3. wage slave said...
I can't believe they're still hyping this up !
Who in their right mind would buy a property in 2008 that most think will be worth at least 10% less in 2009 ?
Actually I can believe they're still hyping this up as they'll be out of jobs soon.
4. confused76 said...
Austin adds: ”One of the best options for investors is diversification. Seasoned investors should diversify on area, type of property and tenant thus widening their portfolio and protecting against risk. Experienced landlords keep the long term picture in mind, wisely investing in areas where rental yields are greater and with fewer void periods. The combination of diversification and research is the key to a strong portfolio.”
UAAAAAAAAAAAAAAAAHHH AHHHH AAAAAAAAAHHH HHAHHH AHHHH HHAHH HAHAHAAHAH
"protecting against risk"
the FSA should jail this i@iot
5. Davros said...
Confused is right.
How can investing in a single asset class be considered protecting against risk?? Putting your money in the bank is protecting against risk.
Let's hope Austin takes his own advice.
6. growler said...
If you want a real laugh, read this: http://www.property-mastermind.com/?p=9
I particularly had to laugh at "Finally, yes people are going to miss out, but only if they hesitate and fail to take action - in which case, they are probably not right for the Mastermind Programme anyway. Almost by definition, if you are decisive enough to enroll then you are decisiveness enough to become rich beyond your wildest dreams in property!"
I wonder what advice would be given now?
7. Papabear said...
This article is pretty daft. It says that, for example, prices in West Hampstead will fall by -10% while prices in Belsize Park will rise by 10%. Now, I've lived in both and know the area very well. For those who don't: the two are about half a mile apart (separated by Finchley Rd.) and prices have over the years moved in sync. I really don't see why now suddenly one would fall while the other would rise by (a hefty) 10%... Seems like more numbers simply being pulled from thin air. I'd say both will fall equally (if anything Belsize Park even more as it's even more overpriced than most areas)
8. paul said...
The Paul, London comment on the site is mine.
Just reminding the media that their own fibs are not so quickly forgotten.
9. confused76 said...
My comment, which won't be published, as usual
"i reckon prices in the "high alert" areas will go back to the 2005 levels, i.e. a drop of 20% to 30%.
but I am not sure that Chelsea will be immune. Remember the high proportion of BTL properties that will have to be offloaded in Chelsea because fail to produce any return on the investment.
It ll be fun to watch, in particular the exit of the foreign investors hit by a double whammy house price deflation and currency depreciation... what a mess
oh, I forgot the icing on the cake: 80% debt leverage which makes every 5% price drop equal to 20% equity plunge... Merry Christmas"
10. confused76 said...
sorry, small mistake... every 5% price drop is equal to 25% equity plunge...
11. Hpwatcher said...
Thanks jack c for the article.
Well you can't blame these guys...a massive industry has been created in screwing money out of people, selling houses at inflated prices.
It won't dissappear overnight.
12. bufferbear said...
So I see you have been published this time confused76!
13. uncle tom said...
There is an element of 'work hard - play hard' about the London market - prices have risen to dizzy heights, but they could also see the most extreme falls..
The Allsop theory that London is protected by fat cat foreign buyers is undermined by the facts that:
a) The world's multi millionaires are not remotely interested in a semi in Southgate
b) These buyers are the first to leave a sinking ship - some 200,000 are reckoned to have left these shores during the last downturn.
The downturn in the capital could be spectacular - whether it will lead or follow the market is less certain though - I suspect it will follow..
14. drewster said...
uncle tom,
Many of the fat cat foreign buyers will be put off by the new £30k annual tax on non-doms. The fattest of fat-cats won't notice it, but if you're earning £200,000 a year as an international lawyer, accountant, or investment banker then £30,000 tax will hurt. Many foreigners will see the new tax as the thin end of the wedge, and will start looking elsewhere to work and live. Tax-free havens like Dubai could become a lot more popular - London can't really compete with year-round sun, cheaper housing, cheap domestic staff, and all the rest! In fact it's even starting to appeal to me....
15. little professor said...
The new map of London property winners and losers:
Courtesy FT Alphaville.
16. Orwell said...
oh, I forgot the icing on the cake: 80% debt leverage which makes every 5% price drop equal to 20% equity plunge... Merry Christmas
- Geoffrey, London
Can anyone explain this?