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House Prices Tipped To Fall 5% As New Low In Mortgage Lending Raises Fears Of Market 'double Dip'

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House prices tipped to fall 5% as new low in mortgage lending raises fears of market 'double dip'

* Net lending second lowest figure ever recorded

* Prices could fall 3% during the second half of this year

* House prices to drop around 5 per cent next year

* Confirmation housing market is heading for 'double dip'

There were new fears for the state of the UK housing market today after mortgage lending dived to the second lowest figure ever recorded.

Lending fell sharply in July as activity in the housing market remained subdued, new figures showed.

Net lending, which strips out redemptions and repayments, totalled just £86 million during the month - a steep fall from June's £518 million, according to the Bank of England.

The figure was the second lowest since the Bank's records began in 1993, although there have also been two months when net lending was negative.

Howard Archer, chief UK and European economist at IHS Global Insight, said: 'Although the Bank of England somewhat surprisingly reported that mortgage approvals edged up in July, the fact remains that they were still at a very low level and point to ongoing muted housing market activity.

'Housing market data and survey evidence has been consistently downbeat recently and this is no exception.

'Consequently, we continue to suspect that house prices will fall back over the latter months of 2010 and then very likely soften further in 2011.'

He expects house prices to fall by around 3 per cent during the second half of this year, followed by a drop of around 5 per cent in 2011.

Andrew Goodwin, senior economic adviser to the Ernst & Young ITEM Club, said: 'This morning's figures provide further confirmation that the housing market is heading for a double dip, with net mortgage lending pretty much flat and the number of mortgage approvals remaining very low.

'These figures tend to be well correlated with prices and they point to falling prices over the second half of this year, particularly now that the supply shortages of the early part of the year have eased.'

Read more: http://www.dailymail.co.uk/news/article-1307671/Mortgage-lending-dives-second-lowest-figure-recorded.html#ixzz0yBd4NQmv

Edited by The Masked Tulip

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Give it a few months and they will be talking percentages that will shock many home 'owners'.

Well lets hope things get sorted sooner rather than later.

I am board of even looking at houses at the moment since my trip to Spain and what you can get over there for 100K

It will be an interesting trip through the winter I think.

I know one thing more and more people are starting to go off property while the greedy are asking to much.

Housing seems to becoming very un-popular with people.

I used to like looking at houses and getting an idea of the price and what i could afford.

If Gordon Clown had not messed with everything we might have been through this by now.

I am getting sick of looking at houses these day, not paying much interest anymore and i feel many many FTB's are also thinking sod it what is the point.

Edited by ZR_Seanie

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The report out yesterday that buyers are giving up is very true IMPO.

Asking prices are just so ludicrous IMPO that there is no point in even looking now.

I was looking at a house in Swansea today that has taken a 100K off asking price in the past 4 months but, you know what, it is still 155K more than I would be prepared to pay.

No point looking basically.

Now that the banks appear to be reverting to 3.5 and 2.5 times salary then I think the vast majority of asking prices are going to have to tank considerably to meet that requirement... or wages are going to have inflate inflate inflate and do so rapidly.

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The report out yesterday that buyers are giving up is very true IMPO.

Asking prices are just so ludicrous IMPO that there is no point in even looking now.

I was looking at a house in Swansea today that has taken a 100K off asking price in the past 4 months but, you know what, it is still 155K more than I would be prepared to pay.

No point looking basically.

Now that the banks appear to be reverting to 3.5 and 2.5 times salary then I think the vast majority of asking prices are going to have to tank considerably to meet that requirement... or wages are going to have inflate inflate inflate and do so rapidly.

Yeah I 100% agree with you, asking prices are mad and people are listing properites for prices that people cannot afford once again.

Either they are in for a shock or we are.

I point blank refuse to enslave myself.

I do see prices starting to drop alot now and i am starting to see more and more that I kind of like.

I have a dame good deposit and this should give me one good start out there but it does not, i am noticing that estate agents almost look desperate to talk to me these days but they dont liek it that i have a limit on what i will spend.

I dont see wage inflation anytime soon. Prices need to drop another 20% for them to be affordable i think

Edited by ZR_Seanie

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I was surprised as prices were going up just how much positve feedback there is in the housing market. One being the way equity growth provides deposits for the next move. 5% falls may not sound very much, but it might be surprising how much effect it has.

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Most of the properties I'm watching here in West Cornwall have already been reduced up to around 10%. Still no one buying

I have noticed that properties in Milton Keynes are starting to get some bigger reductions 10K here and 15K there.

still i cannot make the leap until i know i wont end up wasting money.

Price drops all around apart from the houses that i would liek to look at.

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I was amused to hear a friend telling me how now was a bad time to buy as house prices were about to drop yesterday. They'd been reading the Mail. Most of my amusement came from the fact they'd been suggesting buying for most of the last 12 months before prices take off. The papers themselves are no better. The news they announce is either what is currently happening, or that what is currently happening might continue, would be nice to see them attempt to look beyond the end of their noses.

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I was amused to hear a friend telling me how now was a bad time to buy as house prices were about to drop yesterday. They'd been reading the Mail. Most of my amusement came from the fact they'd been suggesting buying for most of the last 12 months before prices take off. The papers themselves are no better. The news they announce is either what is currently happening, or that what is currently happening might continue, would be nice to see them attempt to look beyond the end of their noses.

I had similar last week - a friend who was advising me to buy a marina appartment as an investment for years came out and told me that he would not touch property with a barge-pole.

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the vast majority of asking prices are going to have to tank considerably to meet that requirement... or wages are going to have inflate inflate inflate and do so rapidly.

Wages are falling.

Unemployment is rising.

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A brilliant comment by a reader there:

This is a disaster. The last thing this country needs is affordable housing. We must print more money right away to ensure that prices remain inflated and families cannot afford to put a roof over their heads.

House prices dropping is just the start of the decay - lower prices will mean smaller mortgages and rents - resulting in people being able to get by on lower wages, making the UK more competitive and making goods/services cheaper. It will mean lower housing benefit payments which will result in lower taxes. This will result in more money in peoples pockets which will be spent on goods rather than lining the pockets of banks and landlords.

This cannot be allowed to happen. Won't somebody think of the bonuses?

- Dan, London, 31/8/2010 14:23

:lol::lol:

Just brilliant.

Read more: http://www.dailymail.co.uk/news/article-1307671/Housing-market-double-dip-fears-mortgage-lending-crashes-new-low.html#ixzz0yCui8lfL

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And house prices will only fall 5% :lol:

It's a start. They can't say house prices will drop 30-40%, because no one will read the rest of the article.

Whats staggering is that just 85million was lent last month. When I heard it on the radio I thought I wasn't listening properly. A tenth of what was predicted!!!! If they can get it that wrong and the real situation is that bad, then 5% falls are best case scenarios for 'speculators'.

85 million is around 540 houses assuming average price of 160K. That's a measley 18 houses a day, nationwide! Incredible. Only last month things were picking up again ... apparently.

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There was a story on BBC Wales tonight saying that Public Sector workers would forego a wage increase in preference to job security - a few months ago it was a wage increase.

Things are changing.

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There was a story on BBC Wales tonight saying that Public Sector workers would forego a wage increase in preference to job security - a few months ago it was a wage increase.

Things are changing.

Try taking a cut to keep your job if you really want it that badly, happened to me the last two years. Guess that's next weeks news story though.

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I had similar last week - a friend who was advising me to buy a marina appartment as an investment for years came out and told me that he would not touch property with a barge-pole.

That's how it is. You weren't the one who predicted it, they always knew it was going to happen!

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That's how it is. You weren't the one who predicted it, they always knew it was going to happen!

That is basically what he said to me after several years of trying to get me to buy a cr*ppy, IMPO, flat in Swansea or Cardiff.

He came out with this full rant about how terrible the flats were, how pokey, cheap, expensive, no facilities nearby. I had to laugh.

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  • 144 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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