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House Price Crash Forum

Never listen to "professionals"


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It astounds me how short the memory of some people is.

Here's a quote by a "professional body" in 1989 (other similar quotes from all over the net and the FAQ page here).

"House owners in many parts of the country are lowering the price of their homes in order to sell them, the Royal Institution of Chartered Surveyors (RICS) states in its survey for the quarter ending in March." ....ie: they are not lowering prices because a massive crash is imminent, but because they advertised at the wrong price....ha-ha.

and another from an "expert" in 1989

"House prices 'to rise'

Property prices in London, the south-east and East Anglia will recover next year and begin to increase by about 10 per cent a year, according to Morgan Grenfell, the merchant bankers, in a report on the housing market published yesterday.."

Why are people taken in by those who palpably are driven by a need to talk the market up? The whole property world is festooned with King Canutes. Why do newspapers and TV/radio organisations always refer to Property agents, surveyors, banks and lenders when trawling for statements about property prices? They are the LAST people anyone should ask if seeking an objective view.

It is a complete myth that property industry professionals don't care either way about the state of the market. When prices are low, or falling, few buy and their turnover takes a dive. Anyone with any involvement whatsoever in any conceivable arm of the property business should NEVER be asked for an opinion on air without their personal interest being clearly defined and declared.

Even with comparitively low interest rates, the conditions for a massive fall have never been more ideal, and are a great deal worse than in 1988 in all other respects. Once the dive takes hold, it will surely hit free-fall.

VacantPossession

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free fall property style...which is not very steep at all really.

I am going to stick my neck out, and based on some historical stat work I've done recently I expect house prices to be approximately 10% lower than their peak price by the end of the year (that is the end of December...which we will see early january I expect). This is using the HBOS data-set.

Either that or price will resume their rise reaching their yearly peak in December.

sounds like I'm putting 10 on red and 10 on black..but I'm not. Its either a continued rise or a 10% drop (there is no place for 0% flat or a measly 5% fall)

Mind you 10% in 6 months is pretty steep, especially since the largest one year fall in the last crash was only around 8%!

Topher Bear

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I partly agree with you there Topher Bear, BUT it will all boil down to how desperate they are to move and the type of property it is.

I gave an example in another thread of how stupid things have got on prices, here it is again.

EA testing the market on a character place, feelers out to people like us guide was about £420K, no takers, vendors now marketing the property with another EA price now £500K, all in the space of 5 weeks :blink:

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VacantPosession, I agree. The vested interests will attempt to convince you that a recovery is "just around the corner". It is amusing reading the headlines from the last crash, the number of articles through 1988-1994 that say "Housing market to recover next year" or somesuch rubbish. The market will only begin to recover when all possible interest has been driven from it and the idea of property may be worth more in the future is furthest from peoples' minds (present company excepted, of course).

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