Friday, Sep 24, 2010
Latest figures show the number of loans approved for those buying a new home fell to a 16-month low
The Daily Telegraph: Britain stuck in a 'mortgage famine'
It's very encouraging to see articles such as this. All the comments say that house prices must fall substantially before younger people are priced in again. Perhaps the bull trap is over and the long-awaited fear and capitulation stages are finally about to begin.
Posted by monty032 @ 09:44 AM (1117 views) Add Comment
9 Comments
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1. nomad said...
Mortgage famine is still the common phrase and banks and building societies are berated for not lending. This, IMO, is only half the truth - as the message that house buying is no longer an easy way to wealth creation becomes ever more prevalent even in the mainstream media. Potential buyers are now happy to wait, whether this means renting, living with Mom and Dad, or in a caravan.
It now looks certain that we are in for a further fall in prices, probably sufficient to flag up last years rally as the souped up dead cat bounce it was - and this with interest rates unchanged. If they remain low while prices tumble, as predicted by brickormortis in his excellent comment on the Quango Cuts post, then the fact that they have to go up later will prolong the decline in prices Japanese style.
2. alan_540 said...
This housing bubble started in '96 and peaked in '07 so about 11 years. If it takes as long to bottom out we're looking at about a 20 year cycle (about 7 more years until we reach the bottom, hopefully, sooner). For young buyers 7 years is not too long to wait as it gives them time to save for a decent deposit and still have some quality of life during that time (not having to put all of their disposable income towards home ownership). For those that have already been priced out of the market for years it's a different story. and they will no doubt not want to wait as long and will buy into the market as it drops and when they can afford to. Don't really know what point I'm trying to make! but I think if I were going to buy I'd be waiting till about 2017.
3. mark said...
Not just the UK, try getting a mortgage in the USA or parts of Europe, would love to see you get one in Dublin lol
no smug anymore, must have eaten his own B%lls
4. alan_540 said...
He was lurking the other day mark, smug as ever :
5. growler said...
perhaps the bull trap is over
you mean it has just begun. Now that prices are falling the bulls will realise it was a trap.
Now the interesting bit will happen....
6. growler said...
give it a few months and we'll see just how much of a crater opens up
7. growler said...
strange, italics off didn't work...
8. voiceofreason said...
Its not a mortgage famine, its a realistic prices famine
9. Ubear said...
Basic supply and demand, for credit, buyers, sellers, and reduced risk tolerance by lenders.
It doesn't help that wages are not keeping pace with inflation and that redundancies are shrinking the number of potential house buyers!