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House Price Crash Forum


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Everything posted by Nozza

  1. I don't know what to make of all this but I don't remember the bears on the board predicting this house rise. I was personally expecting it to be flat for a while and then drop, not keep rising month on month. I'm renting and suddenly the houses in the areas we've been looking at are now out of our price range. It's depressing. I can rant about the stupid UK public like others on here but that makes no difference. The prices keep rising and there is no sign of it stopping. One reason the public are prepared to pay dearly for houses is because renting in this country sucks. Landlords tend to be greedy, selfish and lazy and treat renters with contempt. You don't have the powers you have in Europe, you are at the mercy of your landlord who then steals your deposit to pay for a cheapo paint job when you leave. And god forbid you try to put up a shelf requiring a hole in the wall.
  2. Just to widen the topic a bit - is there really anywhere in the UK that is really chav free...apart from small very wealthy pockets? Seems to me that we are a nation of chavs. I can't work out if it was always like this, whether it's got worse, whether I've just got old and grumpy or if I'm just a complete snob (OK I know I'm a snob!).
  3. Yep Bracknell is a sh*thole. It has got worse over the last decade or so. The town centre is all but dead there now. Like most non-tourist towns the Tesco effect has gutted the local economy and town centre. It was bad anyway but now you're lucky if a hundred people turn up on a Saturday shopping. It also has a lot of quasi-chavs who insist on putting on the strongest East End accents outside of Mary Poppins. Who would really want to go out for the night to meet the bovine, tracksuited cretins who represent the youth there? Don't even get me started on the housing available there.
  4. I know, why do people vote labour in when the result appears to be financial ruin each time?
  5. A friend of mine is a financial analyst. This is what he thinks of the market. I'd be interested to hear others opinions of this opinion: "I believe what we are seeing is a classic 'bull trap'. Have a look at the linked diagram below and it will help explain what I'm getting at: http://www.marketoracle.co.uk/images/2009/...ip_image001.jpg There has been a speculative asset bubble in housing over the last six years, and all asset bubbles follow a very similar path to each other, be it stock markets, oil prices, tulips (in the 17th century - look it up) or houses. Following very, very strong price rises, there is an initial correction period in which prices come back a little. Then, investors generally want to believe that the fall is over. People regain confidence, both believe and want prices to go up, because it is in all owners interests that they do, and investors get sucked back into the market. After that, the market collapses properly. I think we are at the point before the market falls again - the 'bull trap' on the diagram. My reasons for thinking this are as follows: i) mortgage books are contracting. In 2007, half of all mortgages were funded via the securitisation market. This market has collapsed and will not return. Mortgage books are contracting in size and overseas lenders have withdrawn from the market. When liquidity is withdrawn from markets, asset prices fall. There is no replacement liquidity to push prices any higher going forward. ii) structural rise in unemployment - the economic shock from a 8% fall in GDP in this country will take its toll on unemployment. Unemployment probably won't peak for another 18 months. High unemployment leads to increased supply of property (people sell as they lose their jobs) and reduced demand (household incomes collapse). iii) higher taxation - after the election there will be very, very large tax rises on everyone in this country to pay for the budget deficit. The budget deficit is the largest it has been since WW2. If basic rate of income tax goes up to 30%, VAT goes up to 25%, CGT allowance is scrapped and 20p extra duty goes on litre of petrol, even then every hospital and primary school in the country will have to close between Wednesdays and Sundays in order to balance the books over a ten year period. We are about to enter a period of shockingly high taxation and this reduces disposable incomes. House prices are positively correlated to movements in disposable (after tax) income and it this that partly drove the market higher over the last 10 years (along with the securitisation market). iv) rising interest rates - over the next 2-3 years it is likely that base rates will rise to 6, 7, maybe 8%. This will choke off any housing recovery by reducing disposable incomes. Long term mortgage rates have already started to rise. Property prices are negatively correlated to interest rates - they are a quasi financial asset. The Government is storing up additional trouble by schemes such as the Mortgage Protection Scheme which runs for from June 2009. This defers repossessions for 2 years meaning that the supply of property is lower than it would normally be at this stage of the economic cycle. This is helping to create a shortage of property at the moment, and it is exacerbated by people believing that the market will go up again so they will be able to sell at higher prices. This is helping to drive prices up in the short term, but the rise will be capped because there will be increased supply of property if it continues. All these factors will come to bear very heavily on the property market over the next 2-3 years" Crikey - not very positive really.
  6. We're looking up the road in Crowthorne. I don't quite understand what is happening there. Sure there are a few houses that have been on the market for ages. Those people don't appear to want to drop anymore. But the new houses that are coming on appear to be selling/ Most of the houses I've been watching have sold now and not for huge discounts if the stories I've heard are true. Is it possible for areas like this to be somewhat immune to the effects of the crash? E.g. seem a house for £350K and the owners are turning down offers of £330K despite supposedly being "desperate" to move.
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