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House Prices Could Fall Another 40% From Here


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Agreed, however, the value of all other investments can fall as well. Cash is no good - we have negative real interest rates on savings, even if you actually believe the fiddled CPI numbers. Stocks and shares are full of risk and many companies are paying no dividend. Government bonds are paying crap yields and hold the same risks as cash.

If you are looking for somewhere for your retirement fund, even at today's prices, you can't beat property.

For a retirement fund I don't think you can beat a pension if you are a 40% taxpayer (I make sure I don't pay 40% tax) so that's a great return to start. I will agree that a rental property is a useful addition to spread the portfolio and risk.

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Agreed, however, the value of all other investments can fall as well. Cash is no good - we have negative real interest rates on savings, even if you actually believe the fiddled CPI numbers. Stocks and shares are full of risk and many companies are paying no dividend. Government bonds are paying crap yields and hold the same risks as cash.

If you are looking for somewhere for your retirement fund, even at today's prices, you can't beat property.

Good point. Everything is a financial asset and capable of depreciating now that currencies are traded as commodities in the fx market.

Hmmmm... how to remain liquid and in a real asset..... :rolleyes:

Edited by roman holiday
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I tried explaining about this to some dude and he just looked at me as though to to say that that was how it was now. I dont think he understood, but the fact that this doesn't outrage people makes me really angry!!! gggrrrrr

also, i mentioned that I thought average salery was �20k and he said, noooo more like �18k. So you can see how out of kilter his perception of it all was.

YUP!!!

And that's why, to "buy" a roof over your head today - you STILL have to take out a

LIAR LOAN

in one form or another...

i.e.

1 - LIE about your REAL income...

2 - LIE to yourself and take out a STUPID/INSANE MULTIPLES MORTGAGE...

3 - Have the Moneylender LIE to you and tell you both of the above are "ok".....

Fact is --- until and unless "prices" get down to average of around 3 times REAL incomes [£16-18k is REAL average i/c/] - this whole "Credit Crunch" [HA! :P Wonderful obfuscation term! :lol: ] will just get worse and worse......

Edited by eric pebble
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Agreed re the spin. Sad news about the jobs, which just emphasises that the fundamentals are very weak indeed. Plenty more bearish news to come over the rest of the year I am sure.

Rumour has it that Corus UK is losing 1 mill a day, Corus group losing 4.5 mill. Rumour has it that the big South Wales plants will be gone in 3 years. All rumour of course.

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You bears just don't get it do you...

The population is almost 10% higher now than in the last crash.

Pensions were still seen as good investments in the last crash.

I'm writing this listening to the new BTL landlords redecorating their flat across the car park. Their 2 bed flat cost 110k, and they will let it for £6 to £7k a year.

Care to tell me what other investment will yield over 6% today?

Where is the money coming from

the cash buyers have just shot their bolt

hence the spring bounce

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So the best investment the bears can come up with is stamps :P

Pretty much anything is better than property at moment.

Deposit account, current account, cash under the mattress..... you name it, anything, with the possible exception of the stock market has to be a better bet than property at the moment.

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Rumour has it that Corus UK is losing 1 mill a day, Corus group losing 4.5 mill. Rumour has it that the big South Wales plants will be gone in 3 years. All rumour of course.

Good, let the Indians go home with empty pockets, they can't take the ore with them, thats a geological fact. Besides we will need the plants and ore to re-engineer Britain.

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The point is, why would anyone buy a property for 110k now, when you could hopefully buy it for 80K in a few years.

I think you will find after costs the profit would be tiny.

I was in Commercial property so spare me the bull.

I would say continuing to get £6 to £7k a year. in rent was aspirational in the current climate unless its DHSS

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You bears just don't get it do you...

The population is almost 10% higher now than in the last crash.

Pensions were still seen as good investments in the last crash.

I'm writing this listening to the new BTL landlords redecorating their flat across the car park. Their 2 bed flat cost 110k, and they will let it for £6 to £7k a year.

Care to tell me what other investment will yield over 6% today?

That is 6% minus the 5.5% mortgage that must be paid regardless of whether there is someone in the flat paying £500p/m for the priviledge of living there!

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YUP!!!

And that's why, to "buy" a roof over your head today - you STILL have to take out a

LIAR LOAN

in one form or another...

i.e.

1 - LIE about your REAL income...

2 - LIE to yourself and take out a STUPID/INSANE MULTIPLES MORTGAGE...

3 - Have the Moneylender LIE to you and tell you both of the above are "ok".....

Fact is --- until and unless "prices" get down to average of around 3 times REAL incomes [£16-18k is REAL average i/c/] - this whole "Credit Crunch" [HA! :P Wonderful obfuscation term! :lol: ] will just get worse and worse......

Why, with nearly 30 million people with an income and only 17 million owner occupied houses do you think that an average wage will ever buy an average house?

Do you know anyone who bought an "average" house as a FTB with only income multiple and deposit and no equity?

£16-18k is only a real wage in your head, even the median is 25k and the mean is nearer 30k.

If you distrust official wage figures, do you not think the average house now costs 120k too?

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Do you know anyone who bought an "average" house as a FTB with only income multiple and deposit and no equity?

I dont understand your point as a FTB wouldn't generally buy an 'average' property, they get on the first rung so they buy cheaper than average.

I'd be interested to see the average wage of a FTB, the average deposit they put down and the average cost of a FTB property. Then we could compare the correct stats at the bottom end at least, see the wage multiples and stop arguing that the yard stick for measurement is all wrong.

Do we have these stats?

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You bears just don't get it do you...

The population is almost 10% higher now than in the last crash.

Pensions were still seen as good investments in the last crash.

I'm writing this listening to the new BTL landlords redecorating their flat across the car park. Their 2 bed flat cost 110k, and they will let it for £6 to £7k a year.

Care to tell me what other investment will yield over 6% today?

I think you'll find the return is nowhere near 6% when you factor in maintenance, tax, overheads like insurance, management fees (if applicable). And mortgage payments? You seem to be assuming they bought for cash.

And have they even got a tenant yet? :blink:

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Guest pioneer31
James Ferguson was spouting the same stuff in 2004 and was wrong then.

I'm not saying he's not going to be right this time, but if he calls it for long enough, he'll probably be right at some point in the future.

Well I'd rather listen to him than a bull. After all, they were convinced that this wild party was never going to end. He got the timing wrong but at least he got the diagnosis right.

Of course the bulls are all 'wise after the event' now - them and Joe thicky public.

Edited by pioneer31
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