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House Price Crash Forum


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About padders

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  1. I don't see why the banks will go for this. If someone can't pay mortgage now, unlikely to be able in two years once the recession really is fully under way. Given that house prices will be 20-40% lower then, they will have an even greater chance of lossing their money so will want to sell ASAP. Govt istn't protecting the capital only missed interest payments, which offers litter protection to the bank. 3-5% in interest payments is not much compared to 40% capital price drops.
  2. It's clear what should happen. Speed up reposessions, let houses crash then the people who have been repossesed can afford to buy places to live in on their income. The longer the government interfers to try and prop up housing, the longer it takes prices to fall and the longer it takes a normal family to be able to pay their mortgage without having to sell their kids into slavery.
  3. 6% yield with stable prices is a good return; because you are getting a real 6% return, and not 6% - inflation = 3% return. Of course we don't have stable prices now; but that's because no one buying now is getting a 6% return. I am not doing this as an investment, I want somewhere to live - but only when it makes sense to do that. I think when property is back to 6% return, that is about when I know it makes sense again. For my street, thats a 33% drop (assuming rents don't change).
  4. Been here a while, watched prices go from being silly to being rediculous. We will hopefully now watch them go from being rediculous to silly to sensible. Then I want to buy. The question is when that is. As an experiment I sent an email to a estate agency near me. I live in a nice bit of London which has a row of houses, lots of them have been converted into flats. Some of these flats are thus pretty similar: (p.s. I house share now). I got the response: What do people think, a 6% yield is a reasonable expectation? This flat is on the market at £650k, I imagine they would take £600k. I think I need around a 33% drop to make it sensible. Thoughts?
  5. Well, right now they don't. But otherwise they just sell the IOU, debt has a value, if you owe me £10 to be paid in a year's time then that is worth, say, £9 now - so to sell the debt they just find someone who has £9 to buy it.
  6. It depends on what her husband did. If he used up his allowance when he died then she would get £600k - the allowance used up. Otherwise its now gone up to £600k.
  7. 6% fall in 2 years? Thats a 6% nominal fall they are talking about, which even conservativly is a 12% real fall. If you had STL and kept the money in the bank, even only earning 5% / year (after you take off income tax) they are talking about a 16% relative drop if you buy 2 years later.
  8. Just come back from East Africa where the $US is king. The benefit to the US of having the reserve currency in places like this is huge, effectivly the US makes inflation (say 4%) on all the $US floating around africa every year. I wonder if anyone has calculated what % of US GDP is earned just by them having the world's reserve currency. A chance to Euros will be a big boost to European economies.
  9. http://newsvote.bbc.co.uk/1/shared/fds/hi/...welve_month.stm Paragon Group of Companies BANK 273.00 85.00 23.74 Northern Rock BANK 500.00 139.00 21.75 Bovis Homes Group BUILDER 671.00 63.50 8.65 Barratt Developments BUILDER 796.00 74.50 8.56 Bellway BUILDER 1064.00 90.00 7.80 TAYLOR WIMPEY ORD 25P BUILDER 307.25 24.50 7.39 Persimmon BUILDER 1008.00 80.00 7.35 GALIFORM ORD 10P Sells Kitchens to builders 126.50 9.75 7.16 Alliance & Leicester BANK 874.00 63.50 6.77 Bradford & Bingley BANK 334.25 23.00 6.44 5 Builders, 4 Banks and a supplier to house builders. One detects a trend
  10. I think prices are insane and will fall, but where I am (Belsize Park, North London) sentiment has not changed at all yet. We get multiple flyers through the doors from estate agents look for either places they can rent out or can sell. It'll happen, but sentiment hastn't changed in desirable bits of London *yet*. Saying that, one of my friends just bought a flat. Every single one of our mututal friends thinks it's a bad idea. That surprised me.
  11. You can't fix the exchange rate to hide an imblanace. Currency speculators have a lot more money than central banks do, and will win any arms race with the government. Furthermore, putting interest rates causing a stronger currency does not cause inflation, it reduces inflation because a) imports are cheaper so there are more of them and exporters can't sell their goods so they are sold on the domestic market, when again there are more of them. A strong currency is disinflationary not the other way round.
  12. Lomax wants King's job. Who controls her position as deputy governor?
  13. http://news.bbc.co.uk/1/hi/business/6904152.stm
  14. I see october, february as the most likely raises and I think that could well be peak.
  15. A whole article predicting bank of england interest rates with vaguley a mention of inflation (only house price inflation, or lack thereof), incredible.
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