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House Price Crash Forum

mohc

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About mohc

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  1. BOE Prints £1tn Pay off entire national debt. Job done.
  2. Having followed this site for several years whilst renting, prices where I live in dorset are still at 2007 peak levels. In real terms prices are 20% down from 2012. Looks to me like the current level of house prices are no longer inflated enough to trigger a crash. Inflation will remain high, any sign that the economy is faltering will result in the BoE printing more cash. House prices will stagnate for another 3-4 years ending up about 40% down in real terms. Rental values will go up in line with inflation. It makes sense to buy now on a large mortgage and allow inflation to erode the size of your loan.
  3. Does anyone know how to trade in HP futures. If we can purchase a contract to buy at 2011 future prices then we guarantee to get a 7% discount for the cost of the contract. That takes the risk out of waiting to see what happens. If prices fall further than this we lose the cost of the contract but gain through price falls, if prices rise or are flat we gain from selling the contract.
  4. This is just the awesome manufacturing power of the chinese factories reducing costs as volumes increase. If the pound was still worth $2 we would be getting a free plasma screen with each packet of cornflakes we buy.
  5. It is true the only constraints on house prices are monthly repayments and income multiples a bank will lend. Speak to anyone buying a house and they will talk about the monthly repayments. eg. I can afford repayments at £900 / month. If monthly payments increase to £1500 / month then house prices will fall proportionately.
  6. However the bull trap occured much closed to the long term mean line
  7. The banks are not sitting on printed money. 99% of QE has gone to buy government bonds. Either newly issued or bonds sold by foreign investers, taking advantage of the artificially high price created by QE. The net effect of QE is to keep interest rates artificially low. It is the low level of interest rates that is proping up the housing market.
  8. The BOE has printed £125B of new money and injected it into the economy (about 10% of GDP). In response to this growth of 0.1 - 0.2 % month seems scarily weak.
  9. Manufacturers already discount at least £1000, so the only change is the extra £1000 that the government is adding.
  10. Anyone who thinks prices will fall 80% is a fool. That would leave a £500k five bed at £100k, or about £300 / month on an interest only mortgage. I'd buy 5 and rent them out. ------------------- Most sales in our Dorset town are completing at 25% below peak (I would expect sellers to reject offers at 35% below, unless there was something drastic wrong with the property or location). It seems likely to me that prices will fall about 10-15% from where they are now (30-40% from peak). The low interest rates and constant injection of capital will prevent any further fall. I do not expect prices to rise until inflation kicks in again around 2012.
  11. We used offers in excess of to market our property we sold it in november at about 7% below a realistic asking price. If you don't put in excess of you will get offers 15-20% below asking.
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