Sneaker

Can't afford to buy a house? Living costs too high? Paying insane rent to an offshore landlord, who keeps it all tax-free and offshore? Won't ever be able to retire as you need to pay rent? Suck it up, slave! It's the new freedom!

Yep, massive change in what's coming on to the market. Property prices were propped up by the following key factors Oil boom - now gone Chinese dirty money flows - now clamped down on Russian money - now under sanctions Eurozone crisis - now contained (tho not fixed) Dirty money through tax havens - both OECD and UK National Crime Agency clamping down Also a load of junk was sold offshore to people in HK, Singapore & Malaysia who had never even visited the UK. They didn't understand that London is not landlocked like Manhattan or Hong Kong or Singapore. We do have restrictive planning but you can still find space for new-build. We're also only just discovering the "joys" of high-rise living. There is no problem with space or supply. Supply just lagged because it takes several years to get a development from planning out to final release. Over 200 (yes TWO HUNDRED) skyscrapers are in various stages of planning in London.Yes sure interest rates are super-low but UK buyers can't get a mortgage for those insane prices. Cash buyers from abroad have gone away. So yes there is a huge change. Really quite ordinary shoe-box apartments in glass boxes are no longer coming on to the market at totally insane prices. Affordability limits were reached long ago. The price at which the So demand went nuts for a load of one-off factors and supply took a while to catch up. Over 60,000 units are coming onto the London market for a (dreamed of) price over a million quid. Not even 3,000 sell per year at those prices. So we have 20 years' (yes TWENTY YEARS" WORTH) of overpriced shoeboxes hitting the London market at exactly the same time as the demand shock has disappeared. See you 50% lower -- and maybe further. Paying £140m for 10,000 sq ft in SW1 suddenly doesn't seem too clever. That's £14k per square foot. London used to fetch maybe £1k for that kind of stuff 10 years ago. So quite honestly this stuff could drop 90% and still be expensive. See you down below!

Why would you think of paying £500k when you think they might go to £350k...? Surely you should say you'll pay £350k!

Seriously, I do wonder. i am very persuaded by free market arguments. But I rink they're best applied to financial assets and to things where there isn't a basic need for them. housing is a necessarily - it's shelter. Is it right that "ordinary working people" should have to compete with oligarchs, sheikhs and money launderers globally to buy a flat or house? Immigration doesn't really seem to have an effect on house prices. It doesn't matter how many people here - if none of them has money, house prices aren't going up. But all it takes is a few oligarchs to pay exorbitant prices and the whole market can move. Is it really fair to let every rich person in the world but UK property when Brits don't have the reciprocal opposrintify to do the same in their countries? and there are competing arguments - if you can't afford to buy a property where you grew up, you'll just have to move out. But all this does is disrupt society and immunities. Surely it should be a privilege to grow old where you grew up. im thnnjfn aloud a bit here. Probably people here will have lots of different views and maybe tell me why I'm wrong. Interested to see what the forum comes up with

That's because in 2008 suddenly all the clever rich people are selling all those houses they've held on to all the way through the boom. SUDDENLY there is masses of super-prime property for sale, it having been very difficult to find on offer in the last few years. The reason it went up is because people who owned it held on to it, constricting supply. NOW EVERYONE WANTS OUT. This idea that house prices go up because of rich foreigners is equally ridiculous. Stupid Foreigner Theory is as laughable as the idea that house-prices only go up forever. Just like Nasdaq stocks in 1999, because of the riches promised by the New Economy and TMT stocks. What I just cannot get my head around is how we've had two ginormous bubbles LESS THAN TEN YEARS APART. Nobody seems to have learned from the last one, and this one's even bigger. Me, I sold nearly two years ago, a bit early but happy to cash my chips in and take them off the table. Enough's enough. See you at the lows in 2013. I'll be renting til then.

Zoom out and include the 90's experience in Japan and Germany.

I've been following for a couple of years, and contributing on the news blog for a while longer than I can remember. I joined up to the forum because I felt I had something to say. Don't flame the newbies, anyway.

I agree that HPC has become a bit monotone. It used to talk about the future. Now it talks about the past. I also agree that there are some frighteningly well-informed commentators here. It is definitely exciting for us all to be able to come together. So the question is: WHAT NEXT? I started a topic just a moment ago asking just that. What sort of bust is this going to be? Will it mirror the last one, will it rhyme in some way, or will alternate? And when house prices do reach the bottom. What sort of country, or world, will we find ourselves in? And what sort of recovery is there going to be from such an epic bust? US house prices are falling FASTER than in the Great Depression and yet commentators are claiming the US is not in recession. Maybe they're right! Maybe we've skipped straight from boom to depression! Or more sanguinely, maybe Joe Public has been in recession most of this decade, and its only the illusory credit derivatives boom that kept Wall Street and The City from joining in after the tech bust, Sep 11th and then Enron/WorldCom/MCI. I agree that we're not in a deflationary crash, since it's being masked by massive monetary inflation. They feel different, but the end result is the same. Everyone is poorer, there is social strife we people are generally a lot less happy. So come on everyone, what does the future look like? And what do we do next?

I don't quite agree on everything you say. London is the biggest settlement in the British Isles. That actually means it is the biggest and most liquid market. Therefore it is the most efficient. Prices and rents in Cambridge, for example, have seen a far bigger inflation and have reached astronomical levels, both in absolute and relative terms. I agree about a big correction coming. I think prices will go down and then STAY down.

Red Baron, I agree about Cambridge!! The prices are not just eye-watering, they are completely deranged! A flat that overlooks: a railway, a main road, a multi-screen cinema, a disused car-park and a serious of cheap shops and restaurants had sold for £1.5m. ONE AND A HALF MILLION POUNDS for a new-build flat, and that was nearly 2 years ago!! Moreover, there's a new development on St Andrew's Street, called Christ's Lane. Two bed flats that overlook the high street on one side and a bus garage on the other (Christ's Pieces is the other side of it) are being offered at £550k, for 1200 sq ft!!! It is cheaper to buy in West London than in Cambridge!