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Radio 5live This Morning

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A talking head from the house builders association was asked if lowering the price of new properties would help the market.

No he said adamantly, it's the availability of mortgages thats the problem with the market at present and that people should be saving more for a deposit. :unsure:

More blinding insight from an wise 'expert' into why us FTB's can't afford a home.

I nearly wept. :rolleyes:

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Guest KingCharles1st

Luckily I missed this one.

Some of those companies must be getting edgy about having to release more of their landbank back onto the market now

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A talking head from the house builders association was asked if lowering the price of new properties would help the market.

No he said adamantly, it's the availability of mortgages thats the problem with the market at present and that people should be saving more for a deposit. :unsure:

More blinding insight from an wise 'expert' into why us FTB's can't afford a home.

I nearly wept. :rolleyes:

The alternative for hom is to write down his land bank then he has no business. Turkies will not vote for Xmas

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I'm starting to get all conspiracy theory-ish like you guys now, but what if the reason that the banks won't lend on high LTVs despite the big drop in the market is because they know how many repos they need to sell.

There might well be pent-up demand but the pent-up supply has got to be at least as high, surely?

That said I still think slow growth/continued stagnation is likely.

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Even funnier. Bloke from ARLA on now complaining that his members (landlords) have to pay a renew fee to letting agencies when rental agreements are being renewed. When told it was the same for tenants he said that he wasn't interested.

PMSL :lol:

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I'm starting to get all conspiracy theory-ish like you guys now, but what if the reason that the banks won't lend on high LTVs despite the big drop in the market is because they know how many repos they need to sell.

There might well be pent-up demand but the pent-up supply has got to be at least as high, surely?

That said I still think slow growth/continued stagnation is likely.

I am of roughly the same view... a few more months of falls, with falls outweighing any rises until perhaps spring of next year and then a longish period where prices will be broadly stagnant.... the net effect of where house prices will be in ten years time will probbaly be broadly the same but obviously smaller falls and longer stagnation is a very different way of getting there than massive crash followed by a severe boom back.... one of the reasons I suspect we'll see the stagnation is that interest rates will remain low and the recovery in the economy weak.

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I'm starting to get all conspiracy theory-ish like you guys now, but what if the reason that the banks won't lend on high LTVs despite the big drop in the market is because they know how many repos they need to sell.

There might well be pent-up demand but the pent-up supply has got to be at least as high, surely?

That said I still think slow growth/continued stagnation is likely.

House prices were pushed up by lots of newer lenders using securitisation to lend much higher loan values than historically e.g. 6 times salary

This allowed people to pay more for houses and thus prices rose at anything up to 20% p.a. for a few years.

Securitisation has gone and the way money is being lent is as was back in 2002 i.e. more sensibly i.e. 4 times salary

Unfortunately people, including house builders are still expecting people to have the 6 times salary loans and are keeping property priced accordingly. They need to drop prices back to where they would have been if securitisation didn't occur. The result of them not doing this is a lack of turnover and hundreds of thouands of job losses.

Demand is the ability to pay for something at a given price i.e. to actually have the money. For a house that sold for £300k in 2007, there is probably no demand. For the same house, there is probably demand at £225k i.e. that's what people can borrow to buy it.

Until people accept this situation then I think you will be correct and we will have stagnation.

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A talking head from the house builders association was asked if lowering the price of new properties would help the market.

No he said adamantly, it's the availability of mortgages thats the problem with the market at present and that people should be saving more for a deposit. :unsure:

More blinding insight from an wise 'expert' into why us FTB's can't afford a home.

I nearly wept. :rolleyes:

a bit like Anne Ashworth in the Times this morning. It seems that in some people's minds, prices are not a variable.

Ashworth was going on about how rules fixing low LTVs would be bad because it would take people years to save up, they'd be stuck at home for longer, etc etc etc. Not once did she seem to consider that if prices came down, people would be able to save up quicker. The only solution in her head was to ensure that high LTV mortgages remained. Brainless.

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