EvilEdna

Strange that there was no mention in the article of this being "unexpected" - I guess this means George's got it covered.

http://www.guardian.co.uk/money/2011/jan/01/make-money-2011-speculate-on-property Someone is going to make a killing in property in 2011 and, as the National Lottery slogan goes, "it could be you." Despite most forecasters predicting falling house prices, look at what the property investors of yore did. They didn't make money in property because they sold it for a lot but because they bought well, and I predict 2011 to be a year you can buy property well. Let's be clear, 2011 will also be a year you can lose your shirt – and many will. A government report in December suggested that as many as 4 million mortgage holders would be in negative equity if prices fell 10%. The main house price indices confirm that they are already on the slide. It is the people who have got it wrong who will provide many of the deals for those who will lay the foundations to a property fortune. Investing in any asset is not for the faint-hearted: if you are squeamish, go and find a friendly deposit account. Making money in property requires you to take advantage of others' misfortune. The three Ds will drive the market this year: death, debt and divorce will be the motivators that throw up the bulk of the opportunities. Geographically, the UK residential market will be divided between the gated community within the M25 and everywhere else. The London market will prosper and almost anything you buy in the right location and at a sensible price will increase in value in 2011. Outside, you will need to follow my carnivorous instincts when I am advising clients and be predatory. Unless a property is seriously cheap and the seller is offering his first born to take it from him, the chances are you will find you are paying too much for something that will be cheaper tomorrow. This year we will return to the Sarah Beeny school of property investment. Look for something you can add value to. The days of sitting back and watching values rise like barometric pressure are history. Look to convert old pubs. Watch out for commercial properties that were originally houses – they will readily convert back. Identify what people are looking for, check that they can actually buy and then go source the raw material. On the subject of buyers, forget the literally "poor" first-time buyers. Let the government worry about building for them (which they won't). No one wants to lend to them and they struggle to save the £35k deposit out of taxed income now that they have to repay their student loans. People downsizing have cash and they don't need to borrow. Abroad, follow Ryanair. Where can you fly for a fiver? Look to buy or rent a second home there. As with the UK, follow the smell of rotting meat and make derisory offers. Don't forget buy-to-let. It may not be fashionable to say it but income is good and, if you're clever, you should also get capital growth. Housing expert Henry Pryor was an estate agent for 25 years and now advises high net worth and media clients. More at housingexpert.net

The last hpc was driven by repossessions. There have been much fewer than predicted in the last couple of years because interest rates have been kept low and people have been kept on - perhaps on lower hours and without a pay rise - but in work. As a result house prices have stayed high. Interest rates can only rise and there will be significant job losses in the coming year. I'm hoping for a decent fall in house prices next year - not this single figure nonsense, a real fall.

Quite right, the only way we're going to get a crash is an increase in forced sales. I feel like a bit of a ******* for rubbing my hands with glee at this but...

I'm not sure about that. As I remember it the Germans were begging the Irish to accept help and the Irish were happy to stick it out.

Who would you rather have as top dog then? The French, the Chinese...

Are you implying it's all some sort of cunning teutonic plan to wreak havoc? Don't forget a German bank tansfered 300 million Euros to Lehman Brothers the day it went bust. I'd guess the answer to your question is incompetence.

Neither do I, perhaps you could explain them for us.

I know what the ****** is going on.

The Beeb have been trailing this as well, and their angle is that it's gong to hurt bond holders. Here's hoping.. http://www.bbc.co.uk/news/business-11978495

I'm sorry but that's an exaggeration there are plenty of places with OK houses for under 100K

As far as I can see he's talking about commercial property. Given that he may have a point.

Quite agree with you about Edmond Castle I've been following Dalston Road, and have seen lots of houses being taken off the market after sitting around kicking their heels at unrealistic asking prices for a year or two. I've got my heart set on one of the terraced houses that front onto it but there's no way I'm paying 150K for one. I've not seen any decent reductions, but then I've not seen any sales either.

Euro seems to have fallen but not hugely. And I think you're right - they've lost all credibility.

Absolutely agree. The truth is they're stuck between a rock and a hard place. Which is why they'll scream no more bailouts from the rooftops whilst finding some surreptitious way of doing the exact opposite of what they say. That's how I understand the ECB lender of last resort thing. Funding insolvent banks who can then lend the money they've raised to their insolvent sovereigns.

They've said this before but at the first sign of trouble they back pedal hurriedly.

What if the alternative is forking out for bailouts in Portugal, Spain, Belgium etc. Not something the Germans have been very keen on.

Might be enough to get them a mortgage on a starter home

If that's what's on the cards why has the Euro shot up today - I don't get it.

Quite - sad but true.

What about the flights of capital from Southern Europe into Germany this would entail? There'd be no money left in the Med at all.

Found this on the Guardian website: Arturo de Frias, head of banks research at Evolution Securities, argued that the costs and consquences of the single European currency falling apart were too high for it to be allowed to happen. He wrote: "If the euro goes, the whole European banking system – including the banking systems of the core nations - would be nearly bust. If the euro is abandoned, and we go back to the peseta, lira, escudo, dracma, etc, devaluations would follow immediately. And devaluations mean write-offs of loans and investments - of a size that would render the whole European banking system completely insolvent. According to Basel, last June, German banks had €250bn claims vis a vis Spain and Italy. If Spain and Italy devalue by 30% on their way back to the peseta/lira, the German banks lose €74bn. If you add Greece, Portugal, and Ireland, total losses would be €120bn. That is almost half of the total equity capital of German lenders. The French banks have €430bn claims vis a vis Spain and Italy. A 30% devaluation would imply €129bn losses. Add Greece, Ireland and Portugal and the total losses would be €160bn. This is more than the capital of BNP, SocGen and CASA combined. The UK banks have €132bn exposure vs Spain and Italy. That means €40bn losses. Add the smaller countries and we get to €80bn losses. That is nearly half of the equity of Barclays, Royal Bank of Scotland and Lloyds Banking Group. Combined, the French, German and UK banks could lose €360bn if the euro goes. The only way forward is fiscal union. It has become now 100% evident that monetary union without fiscal union does not make any sense. My gut feeling is, the decision has been taken already." I actually found myself agreeing with him - does anyone else have any thoughts?

A twit and a spiv in my honest opinion. He single-handedly bankrupted the industrial society as well. :angry:

Good point Selling Up - thanks for that, I'm sure you're right.

George Osborne in 2006 "A generation ago, the very idea that a British politician would go to Ireland to see how to run an economy would have been laughable… Today things are different. Ireland stands as a shining example of the art of the possible in long-term economic policymaking, and that is why I am in Dublin: to listen and to learn." What a smug chancer that git is.