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The Masked Tulip

Four Reasons Why Uk House Prices Will Keep Falling

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Yesterday saw another sign that Britain's housing market is bottoming out. Or so you'd have thought from some of the media coverage.

But on a closer look, the latest residential lettings survey from the Royal Institution of Chartered Surveyors (RICS) wasn't really that upbeat at all. And it certainly hasn't changed our view that house prices in the UK still have some way to fall.

But for the US, it might be a different story…

http://www.moneyweek.com/investments/prope...fall-93707.aspx

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Fidelity's Anthony Bolton explained in the weekend's FT about the stock market, "if everyone is positioned for the market to rise, it means these bullish expectations are already discounted" – i.e. factored into the price. As a result, "the market often moves to make the majority wrong and does the unexpected… so at turning points especially, the correct is the minority view".

Investing 101.

When everyone has a strong consensus about the market, they are inevitably bound to be wrong about it.

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I find the "Four Reasons to..." style a bit annoying, and it feels like a test to work out what they are.

I think the article was saying:

Interest rates are low and can only rise.

Credit crunch - big deposits, poor rates for borrowers.

Unemployment.

Mini bull run set for reversal, as that is what markets do.

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Fidelity's Anthony Bolton explained in the weekend's FT about the stock market, "if everyone is positioned for the market to rise, it means these bullish expectations are already discounted" – i.e. factored into the price. As a result, "the market often moves to make the majority wrong and does the unexpected… so at turning points especially, the correct is the minority view".

Investing 101.

When everyone has a strong consensus about the market, they are inevitably bound to be wrong about it.

Bolton is talking total pants, everyone is bearish which means the market can probably move further. Til the last person turns bullish... at which point the next sell off will happen...

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Four Reasons why UK House Prices Will Keep Falling:

1. There is no more credit available to fund the asking prices

2. There is no more credit available to fund the asking prices

3. There is no more credit available to fund the asking prices

4. There is no more credit available to fund the asking prices

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Four Reasons why UK House Prices Will Keep Falling:

1. There is no more credit available to fund the asking prices

2. There is no more credit available to fund the asking prices

3. There is no more credit available to fund the asking prices

4. There is no more credit available to fund the asking prices

:)

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Four Reasons why UK House Prices Will Keep Falling:

1. There is no more credit available to fund the asking prices

2. There is no more credit available to fund the asking prices

3. There is no more credit available to fund the asking prices

4. There is no more credit available to fund the asking prices

That doesn't matter. We have pent up demand :P

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We _are_ an island you know - we have a limited amount of space and a growing population - not to mention the immigration we need to keep up the number of viable workers in our aging population.

The buying power of couples now that both partners are working pushes the prices up, and on top of that there is unprecedented demand from a rapidly expanding singles market due to the breakdown of families.

Supply and demand.

Nothing to do with buy to let or credit availability. What a ridiculous idea.

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We _are_ an island you know - we have a limited amount of space and a growing population - not to mention the immigration we need to keep up the number of viable workers in our aging population.

The buying power of couples now that both partners are working pushes the prices up, and on top of that there is unprecedented demand from a rapidly expanding singles market due to the breakdown of families.

Supply and demand.

Nothing to do with buy to let or credit availability. What a ridiculous idea.

Hope you are joking on the limited amount of space comment.

Do you do much travelling around the UK?, You only have to go a few miles out of every town to realise there are great swathes of land fit for living on.

Enough for the indigenous and all the immigrants, we are mere pawns.

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The consensus among "normal" people is that the "blip" in the housing market is almost over.

In the last 2 weeks I was assured by a woman in her 80's that "you can't go wrong with bricks and mortar" and by a man in his late 50's that "prices will be back to normal soon enough"

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The consensus among "normal" people is that the "blip" in the housing market is almost over.

In the last 2 weeks I was assured by a woman in her 80's that "you can't go wrong with bricks and mortar" and by a man in his late 50's that "prices will be back to normal soon enough"

Bizarrely they're both right.

The lady in her 80s can only see that she bought her house 50 years ago and it's increased in "value" 100 fold since.

The man in his 50s is right......but he doesn't know that "normal" prices are a long way down from here.

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Are Moneyweek like those dodgy tipsters who tip different horses in the same race so whatever happens they have the winner?

I get their email and saw the one about house prices dropping but today received this:

"Get ahead of the curve

Your own diverse portfolio of stunning residential property developments

You can either share in the profit of one or more of these developments - confidently targeted at 25%+ annual growth over the course of a project - or take the lower-risk Priority Return option of 22.5% over three years (7.5% pa). "

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The buying power of couples now that both partners are working pushes the prices

That's such a bad argument. If anything, both partners in a couple are having to work because prices got so massively inflated.

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Bolton is talking total pants, everyone is bearish which means the market can probably move further. Til the last person turns bullish... at which point the next sell off will happen...

Bolton called the market rise when people here were talking Falls to 3000 and below

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We _are_ an island you know - we have a limited amount of space and a growing population - not to mention the immigration we need to keep up the number of viable workers in our aging population.

The buying power of couples now that both partners are working pushes the prices up, and on top of that there is unprecedented demand from a rapidly expanding singles market due to the breakdown of families.

Supply and demand.

Nothing to do with buy to let or credit availability. What a ridiculous idea.

We only have a limited amount of jobs TOO.

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The buying power of couples now that both partners are working pushes the prices up, and on top of that there is unprecedented demand from a rapidly expanding singles market due to the breakdown of families.

Supply and demand.

Nothing to do with buy to let or credit availability. What a ridiculous idea.

So dual-incomes can now buy a house without needing a mortgage? What?

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We _are_ an island you know - we have a limited amount of space and a growing population - not to mention the immigration we need to keep up the number of viable workers in our aging population.

The buying power of couples now that both partners are working pushes the prices up, and on top of that there is unprecedented demand from a rapidly expanding singles market due to the breakdown of families.

Supply and demand.

Nothing to do with buy to let or credit availability. What a ridiculous idea.

cheers, always good to have the really deep thinkers wading in.

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Are Moneyweek like those dodgy tipsters who tip different horses in the same race so whatever happens they have the winner?

I get their email and saw the one about house prices dropping but today received this:

"Get ahead of the curve

Your own diverse portfolio of stunning residential property developments

You can either share in the profit of one or more of these developments - confidently targeted at 25%+ annual growth over the course of a project - or take the lower-risk Priority Return option of 22.5% over three years (7.5% pa). "

The first email you received is from them. The second you received is from advertisers. When you sign up to their email they inform you will get sent adverts.

I have no idea how successful their tips in the magazine proper are like. Personally I think people like that are good for macro comment, but would be wary of specific tips on stocks.

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