Sunday, Dec 23, 2012

What does 2013 hold?

Guardian/Observer (Online): House prices to stay in doldrums for 2013, estate agents predict

"House prices to stay in doldrums for 2013
According to this article published a few days ago, this is the “unanimous” opinion of EAs and property consultants.
Who would have thought, at the time of the credit crunch 5 years ago, that this is where we’d be in now? Somehow, the powers that be have managed to keep prices from crashing. So why should the next year (or 5) be any different?
At this festive time of year I thought it might be fun to ask the users of HPC to post their views on what 2013 holds. I suggest breaking this down into categories and being as brief as possible:
1. What will happen to house prices in 2013?
2. Top 3 (in order) reasons why I believe this will be the case
3. What, realistically, might change all that and lead to a real HPC in 2012?

Posted by grumpybob @ 12:23 AM (3484 views) Add Comment

10 Comments

1. grumpybob said...

I’ll get the ball rolling.

1. What will happen to house prices in 2013?:

Boring, I know, but I have to conclude that I agree with the EAs quoted in the article: I expect prices to be very much the same this time next year.

2. Top 3 (in order) reasons why I believe this will be the case:

- I believe the BoE will keep the base IR at 0.5% . Their hands are tied. It would cause too much panic if they put them up – especially if they put them up (even gradually) to, say, 1.5% by this time next year.

- Against all my expectations it looks like the Eurozone is going to hold together (certainly looks a lot more likely than it did this time last year). Therefore, no major shock to the British economy as a consequence of Greece (for example) defaulting and/or the Eurozone breaking up entirely.

- UK employment holding up pretty well. Most people can (just about) afford to keep up the payments on the massively overpriced houses they bought in the years up to the “crunch”.

3. What, realistically, might change all that and lead to a real HPC in 2013?:

Well, I suppose anything that caused UK IR to rise sharply (especially if suddenly). A messy Eurozone breakup might do it.

Sunday, December 23, 2012 12:25AM Report Comment
 

2. novice pete said...

1). Food price rises.
2). Fuel price rises
3). Trying to recover from Christmas overspend by cutting back further on general spending.
4).Possible introduction of toll roads, meaning people can no longer afford to travel to work, leading to further rise in unemployment, leading to further rise in mortgage and rent defaults, leading to further rise in landlord mortgage defaults, leading to banks having to write off further debt, leading to Go'Mint having to print further money to bail out banks, leading to further devaluation of the pound, leading to higher inflation, leading to people having to cut back more on general spending, leading to less profits for companies selling goods and services leading to said companies laying off more staff, leading to ......oh sh*t! I think I've made my point.

Sunday, December 23, 2012 01:22AM Report Comment
 

3. mark wadsworth said...

House prices will resume downward slide and end the year 15% lower than now :-)

Sunday, December 23, 2012 11:25AM Report Comment
 

4. Edgeinvestorcouk said...

Stagnation is the key word, in terms of house prices and wage inflation.

The days of earning money through inflationary techniques are gone i.e. mutual funds or house prices, the days of having to actually actively earn money are ahead and most passive methods will be gone. We offer such a method.

Sunday, December 23, 2012 12:09PM Report Comment
 

5. mark said...

there are so many price hikes next year to screw the public, i was chatting to a girl the other day who is moving out of rented apartment as the landlord had removed 1 of her parking spaces and increased rent from jan by £150 a month

Sunday, December 23, 2012 12:33PM Report Comment
 

6. hpwatcher said...

House prices to stay in doldrums for 2013

I would not call an all time high 'in the doldrums' - but call me old fashion.

For 2013 - UK government will TRY and keep interest rates at an all time low, if they can. All now depends on government debt - they are broke, and unable to cut back. The question is how far they will go in the continued destruction of the currency.

Sunday, December 23, 2012 01:54PM Report Comment
 

7. grumpybob said...

@3

I'll remind you of your prediction this time next year Mark :o)

Sunday, December 23, 2012 02:24PM Report Comment
 

8. nod2glod said...

1)
house prices will remain mainly flat in nominal price.
house prices will drop 10% in real inflation adjusted price.

2)
i) The uk government will be able to keep it together with even more creative bookeeping. QE will not be resumed in name, but through other QE style schemes.
ii) Real consumer inflation will continue to increase but will not register as such in offical stats.
iii) The vested interests will not willing give in. All avenues will be attempted before the markets force interest rates up, but not in 2013.

3) massive global macro economic shock
a) large scale shooting war : japan - china, iran - israel/friends
b) oil supply disruption

Sunday, December 23, 2012 04:08PM Report Comment
 

9. happy mondays said...

1) People will work out it's all a scam & refuse to pay these stupid prices :)

Sunday, December 23, 2012 04:48PM Report Comment
 

10. growler said...

People will continue to tread water so l as they still have a job. If this changes, I'm with Mark W

Sunday, December 23, 2012 10:00PM Report Comment
 

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