Merged: House Price Slump May Last A Decade, Experts Warn.

[the flying pig]

Today

and who said quality journalism was dead...

[Guest Steve Cook]

How will this work for London? Will they be moving 3 out of every 5 people out?

I hasten to add, I'm not some racist nutter. But that was funny....

Edited July 13, 2010 by Steve Cook

[Mal Volio]

There is no motivation to buy a house if prices are not going to rise over the short to medium term.

If house prices are expected to fall and interest rates are expected to rise and people dont feel secure in their jobs I can see people losing interest in housing. This happened in the 1990's. I remember houses being dirt cheap and nobody cared.

^This.

It's this key change in sentiment that causes a crash. If people think house prices are rising /will rise then they tend to pile in (if they can get the finance). If they think they might lose money on the deal, they tend to hang back. It's a strong positive feedback mechanism, whichever way it operates. It just needs a minute shift in sentiment to trigger a much bigger effect.

[PopGun]

Quality journalisim aside, I don't remember there being so much HPC bear food articles pre 2008 crash!

Could be the big one, lets hope it won't be an even bigger dissappointment.

[Guest BetterOffOnBenefits]

But it does not force people to sell, the market could just stagnate. If the government props get removed then the story may be different.

why didn't this happen in the 90's?

[PopGun]

Oh look. Lets justify outrageous pay by comapring it with Fred Goodwin (baled out by Labor).

http://onlineslangdictionary.com/definition+of/barry

Barry:

Shortening of the Australian slang Barry Crocker which is rhyming slang for "shocker". Used when someone has not performed well or seriously f*cked up.

"He's had an absolute Barry!"

Edited July 13, 2010 by PopGun

[Pole]

But it does not force people to sell, the market could just stagnate. If the government props get removed then the story may be different.

The ultra low volume property market would mean 1000s of EAs out of job.

And don't forget old people downsizing. There quite a lot of them around. And without the first time buyers, chain sales are dead so prices MUST come down. There's no other way.

[Gone baby gone]

Quality journalisim aside, I don't remember there being so much HPC bear food articles pre 2008 crash!

Could be the big one, lets hope it won't be an even bigger dissappointment.

Hmmm, isn't the point that the "big one" isn't going to happen, not in the way we first expected. It's going to play out over a decade or even longer, not an 18 month period. Bad news for STRs who hoped to hop off the ladder (in 2004 in some cases ) and then back on again 18 months later when the crash had happened, but good news for FTBs and current OOs looking to upsize.

Anyone who is retiring in the next 10-20 years and has "property as their pension", needs to think seriously about extending their retirement age, or getting rid pronto.

[erranta]

There is no motivation to buy a house if prices are not going to rise over the short to medium term.

If house prices are expected to fall and interest rates are expected to rise and people dont feel secure in their jobs I can see people losing interest in housing. This happened in the 1990's. I remember houses being dirt cheap and nobody cared.

1990> The Govt and City rip-offs were media brainwashing all the little people to sink their savings into newly privatised 'Utilities' - "have a gamble in the City you scum"

Around 1996 BTL mortgages invented, Browns City deregulation put in place (shortly after the 2000 "Dot-com" City setup - wiped the shares of the little people out!)

Anyone with anything left, herded into BTL as an investment safe-haven (sic) ready for the houseprice bubble/con with UK Govt vi involvement, exposure & direct manipulation clear as day!

Edited July 13, 2010 by erranta

[Oliver Sutton]

http://onlineslangdictionary.com/definition+of/barry

Amazed at the Public Sector Piggies squealing on here.

Don't they realise more money for someone like this is less money for them (and more importantly less money for frontline services).

They are so thick they imagine there's a limitless pot of money.

[erranta]

The ultra low volume property market would mean 1000s of EAs out of job.

And don't forget old people downsizing. There quite a lot of them around. And without the first time buyers, chain sales are dead so prices MUST come down. There's no other way.

Hundreds of thousands flats, bungalows, houses come on the market every year due to deceased estate sell offs.

This will greatly accellerate as boomers start to croak - should be awash with plenty of housing in 25yrs.

[PopGun]

Amazed at the Public Sector Piggies squealing on here.

Don't they realise more money for someone like this is less money for them (and more importantly less money for frontline services).

They are so thick they imagine there's a limitless pot of money.

Not that I condone the head teacher's wage, nor any other PS wage > £80k. However this is still Insignificant compared to the theft of just one senior banker.

Like a puppet on a string. Keep the ignorance coming, though I'll give you the benefit of doubt that maybe the recent hot weather has melted your plastic head.

[Timm]

PDF of the actual report is available here:

http://www.pwc.co.uk/eng/publications/ukeo_jul2010_houseprices.html

[PopGun]

Hmmm, isn't the point that the "big one" isn't going to happen, not in the way we first expected. It's going to play out over a decade or even longer, not an 18 month period. Bad news for STRs who hoped to hop off the ladder (in 2004 in some cases ) and then back on again 18 months later when the crash had happened, but good news for FTBs and current OOs looking to upsize.

Anyone who is retiring in the next 10-20 years and has "property as their pension", needs to think seriously about extending their retirement age, or getting rid pronto.

Probably but I wouldn't discount a heavy three month 25% drop, followed by another 5+ years of 2% yoy falls.

I still maintain that if the ball doesn't start rolling by the end of the year, I doubt very much that it ever will.

[Ritters]

Just checked the diana express and they're reporting on it too, but strangely enough:

1) it hasn't made the front page

2) you can't comment on the story

[Gone baby gone]

Probably but I wouldn't discount a heavy three month 25% drop, followed by another 5+ years of 2% yoy falls.

A 3 month 25% drop! I'll have what you're smoking Even when the financial system was teetering on the edge of the abyss, they only dropped 12% over a year!

[Executive Sadman]

A decade isnt really that exceptional in the context of the last crash

http://www.housepricecrash.co.uk/indices-nationwide-national-inflation.php

It took until 1998 for prices to return to their nominal 1989 peak, and didnt return to their 'real' peak until 2002-2003, ie almost 14 years later.

I cant see them ever, at least not in my lifetime returning to 'real' 2007 levels.

[Mal Volio]

But it does not force people to sell, the market could just stagnate.

I think that's very likely, at least at first. As Fudge said:

I remember houses being dirt cheap and nobody cared.

Volumes will fall through the floor as sellers batten down; the only good thing about that is that (here at least) that's what they've been doing for 2 years, waiting for the market to "recover". Another leg down will likely dispel that myth, and shake out the people who actually want, or need, to sell from the time-wasters and the deluded.

A scenario of big price falls associated with huge sales volumes is not going to happen; more likely is a hefty leg down on the back of small numbers of forced sales, and then a prolonged period of low activity as people adjust to the new housing market paradigm.

edited to add:

If interest rates were to rise, of course, it'd be quite different. But the Govt knows that, and it'll only allow that as a very last resort. Widespread NE and repos is a pretty sure-fire way to lose the next election

Edited July 13, 2010 by Mal Volio

[roadtoruin]

A decade isnt really that exceptional in the context of the last crash

http://www.housepricecrash.co.uk/indices-nationwide-national-inflation.php

It took until 1998 for prices to return to their nominal 1989 peak, and didnt return to their 'real' peak until 2002-2003, ie almost 14 years later.

I cant see them ever, at least not in my lifetime returning to 'real' 2007 levels.

Some of the worst affected 1989-crash property (overpriced flats) didn't even recover nominal value till around 2002 I bought a flat in South London in 1988 and it only got back to it's original selling price in 2002.

[Oliver Sutton]

Squeal .. squeal .. squeal..

But some other Piggies have stolen even more than we have.

[erranta]

Today

Its a big joke by the Scottish Masons - letting them in!

Poles/Ukraines, Kurdistanies, (eastern/central europeans) are all 'Scythians' - they are directly related to the original Scots tribe - blood-relatives!

St Andrew was "spread eagled" and killed (after wandering around the Scythian region of central/eastern Europe) finally killed in Patras aprox. central-west greece - where scots get their flag cross from!

Andrew is the patron saint of Ukraine, Scotland, Russia, Romania, Greece, Amalfi, Luqa in Malta, and Esgueira in Portugal

Where do most of the recent immigrants come from?

"In the 1920s and 1930s, Amalfi, Italy was a popular holiday destination for the British Upper Class and aristocracy"

[goldbug9999]

Widespread NE and repos is a pretty sure-fire way to lose the next election

For every vote lost because of repo/forced sale, there is a vote gained because of a happy purchaser of a decently priced property.

[dances with sheeple]

they'll fail yes, but that's no reason not to worry. the damage they'll do trying to keep it inflated will impoverish most of us.

What are the new government doing that indicates they want to keep it inflated? Everything they have proposed so far says Game Over?

[eric pebble]

What are the new government doing that indicates they want to keep it inflated? Everything they have proposed so far says Game Over?

It's the BANKS that hold the key to everything -- the rest are pretty well irrelevant...

Even if the Govt./FSA puts in "rules" about sensible lending, the BANKS/Moneylenders will get round it one way or the other....

BANKS/MONEYLENDERS are where the REAL power is...........

Edited July 13, 2010 by eric pebble

[Tired of Waiting]

Err no the private sector would have given him ((Fred Goodwin)) fck all as the company is insolvent, the public sector gave him 170k+ when they bailed out the bank like muppets

Good post.