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andrew_uk

Posts From My Topic Started 2004

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I’m resurrecting my first ever post from 2004 so six years ago. My point at the time was to try to show the public opinion of the time and then update it every 12-18 months. You may or may not find it interesting but in 2004 we were in the grip of the housing boom.

Unfortunately my first ever post has been deleted and in case others start getting removed due to age I’ve started again. I’ve included an update including all of them I could find. The original start at http://www.housepricecrash.co.uk/forum/index.php?showtopic=3141&st=0

I’ve tried to highlight the most interesting points

2004 post (now deleted)

It started after I sold my house. I’d brought it in 2000 for the princely sum of £39,950 and sold it in Sept 2004 for £86,000. I know some monetary history hence my statement at the time was:

<quote>

For the record I gained 110% on my house in 4 years, with a 95% mortgage so with 20/1 gearing I got a 1,100% increase on investment. I know that should be impossible since growth + inflation = ~4% a year. I worked out that if I could maintain that gearing, impossible I know but the rest is the same, after 20 years I could buy everything in britain (58 trillion), after 23 years everything in the world 1 zillion (or whatever comes after trillion). By 107 year I have more pounds then there are atoms in the universe. I think the growth in house prices at least in my area are unrealistic.

</quote>

At the time people with no investment experience such as my sister and best friend were talking to me about getting into buy to let. The view was if you had enough cash or could get credit it was a license to get into BTL and print money.

The only property porn program I watched was Sarah Beenies. 90% of them were newbies who made massive mistakes but still made a fortune due to the raising market. Generally along the lines of buy for 150K, budget 30K for improvements and sell for 210K. It’d end up costing 90K and take 9 months not 9 weeks but they’d sell it eventually for 300K and make a 60K profit.

Second post July 2006

Time for an update on my first ever post (remember 18 months have passed):

People called me an idiot for selling:

+Friends&Familly now say I sold at the right time and I wasn't an idiot (I still have ceiling price on the road)

+ They believe prices are lower now (maybe regional) especially nice detached houses

- They think that since the top end houses have fallen & the market is full of them I should consider buying in the next year or two.

The media:

+ It's changed a lot, the number of housing programs has dropped, property ladder especially has changed.

+ I actually see articles talking about possible house price falls

+ Halifax stated house prices fell 1.2% (Lots of people around me noticed this, i ignored it)

- We haven't yet seen the phrase "Crash" used by a newspaper for a prominant article.

Main stream financial news (credit crunch):

+ I keep seeing articles about debt levels being too high

+ People are telling me they wish they didn't have so much debt (and point out it could've been avoided)

- The credit is still available and self cert/high risk mortgages are still available.

Financial - Investment:

+ The price of gold/oil is up a lot (gold ~50%, oil ~40% averaged out)

+ People who I mentioned a possible recession to last year are now telling me about it as if it's there idea

- The media is still bullish and everyone thinks they deserve to make big bucks meaning money is still flowing in.

My Personal view:

+ I'm happy I sold the house and happy I recently sold my sports car (My inflation hedge last year lol)

+ I didn't miss out on a 20% rise in the house I sold

- I think another 3-5 years before buying a house is a good idea.

-------------------------------------------------------------------------------------------------------

August 2006 Interest rates (reply to a post) for continuity

But some long run views on IR's:

1 year before my first post (boom times around me) - 3.5%

First post IR - 4.75%

18mths later - 4.5%

Today - 4.75%

But historically we track global interest rates especially America's. From my first post to today there rate has gone from 1.75% to 5.25% and if America can raise rates by 4.5% over 23 months we could do the same.

But as I said IR's are only a small part of the story

-------------------------------------------------------------------------------------------------------

August 2006 How to know the bubble has burst (reply to a post)

Hi Immigrant,

How long?

I expect a front page newspaper article in a tabloid announcing "house prices fall for the second month" followed by a graph in the paper showing annual price increases have gone negative in 2007.

My biggest problem is the amount of statistics and VI spin as they might wait until 2008 and then post articles that prices had collapsed in 2007 and are now increasing again. [Edit hasn't something similar to this happened in the last 6 months?]

The Irish Bubble

This is much larger than the British bubble and will fall later, faster and further. From an outsiders point of view it seems more like a ponza scheme than a bubble.

I might be wrong but I thought that the older generation was taking out equity to part fund purchases for the younger generation (there sons & daughters).

This means money from the top of the pyramid flowing back to the bottom very very dangerous.

A quote from george orwells 1984 "the system will eat itself".

Why is my faith so unshakable?

1) Self interest/Greed

Basically if a crash occurs it's good for me so it's much easier for me to believe this will happen. Any Bear who doesn't realise this is fooling themselves.

I'm worse than most since I'm STR and hope to make money on the way up and then buy cheaply on the way down.

2) the dot com boom

I did a long post about this elsewhere HP boom V .Com boom but basically I've seen and felt this euphoria before.

It cost me money to learn that just because everyone's in the same boat doesn't mean the boat won't sink.

3) Historical graphs

Average price to average earnings is a particularty strong argument to me. I just don't think it's different this time.

"Those who do not learn from history are doomed to repeat it".

4) Personal observations

I've seen credit go crazy.

People on half my salary with brand new cars, going on holiday 3 times a year, buying plasma screen Tv's, new kitchens and assorted other stuff. There view of organising finances is getting a consolidation loan with enough left over for a holiday.

Now I'm seeing people talk about how they don't have any money (cards maxed or wisely stopped using them).

I've seen more recently (last 6 mths) people getting worried and counting up the debts.

But the main 100% definate reason for prices to fall is drum roll...............

Everyone said they couldn't imagine prices falling!

Extra: As implied by others inflation can have a factor but in my view after a lot of analysis and thought I believe we are ultimately heading towards deflation not inflation.

Through a short inflationary period (in commodities rather than housing or shares) might occur first. Look on GEI for more details as I posted there and Dr Bubb put up a roadmap which also ended in deflation.

-------------------------------------------------------------------------------------------------------

Third post March 2007

Time for a second update on my first ever post

First post - November 2004

First Update - August 2006 (18 months later)

This update - March 2007 (25 months later or 7 months since the last)

I hope people realise from this just how slowly a housing market changes. In a little over two years a lot has changed.

My notes below compare to 2004.

People called me an idiot for selling (Nov 2004):

+Where I rent is a palace and so much better than anything I ever expected to live in. The general view is I've done very very well.

+A few friends have recently put there houses up for sale as they think it's topped out.

+Heaps of anecdotal stories from friends telling me they think a recession is coming (I told lots of them this 9 months ago).

+Friends&Familly now say I sold at the right time and I wasn't an idiot (I still have ceiling price on the road)

-People are telling me I could've waited longer to sell and made more.

The media:

+ I'm actually reading articles that mention a recession, a slump in America and that house prices could fall. Such a change.

- We haven't yet seen the phrase "Crash" used by a newspaper for a prominant article.

Main stream financial news (credit crunch):

+ Debt levels are being talked about as a problem.

+ The CPI measure is being attacked as not reflecting the true cost of living.

+ People have stopped talking about debt but also don't talk about buying things anymore.

+ A few friends have taken out big re-mortgages not to spend but to clear all other debt and put away for a rainy day.

- The credit is still available but getting more expensive and BTL mortgages are demanding higher deposits/fees.

Financial - Investment:

+ The price of gold/oil has gone up and doesn't look as if it's coming down ever (no more $30 oil or $300 gold).

+ People who I mentioned a possible recession to last year are now telling me they are seeing the evidence (falling activity/order books)

+ The media has lost it's bullish stance and are talking about the carry trade unwinding/recessions.

My Personal view:

+ I don't monitor house prices anymore and haven't posted on here for months as I don't care what happens since I'm safe.

+ I'm now certain a crash is coming but it might be 2008 before it really hits.

- I think it'll be another 5-7 years before buying a house is a good idea (it's gonna be worse than I'd originally expected)

Interest rates:

Up from 4.75% to 5.25% and expected to keep rising. Note 1 yr before my first post they where 3.5%. A 50% increase in 3 years.

I'm gonna keep renting and basically not caring about house prices, investments or anything like that. I'm debt free, have cash/gold as savings and just ignore house prices. I am considering reducing my pension contributions for a few years and saving the cash to use later.

-------------------------------------------------------------------------------------------------------

Fourth post July 2007 (Earlier than normal)

People called me an idiot for selling (Nov 2004):

+It was honestly the best move I have ever made and gave me great joy to be out of a shit hole in a bad area and renting in a palace.

+Lots of people are stressed about housing and are jealous of the fact I have zero stress about housing.

-I no longer have ceiling price on my street. The people who bought my house sold it in 2007 for 3 grand more. Nothing else has sold. I'm still glad I sold as I now know i did not miss out on the supposed 20% increase in house prices after I sold it.

The media:

+I read articles about house prices falling, BTL in particular flats being a bad idea and the whole housing being a one way bet has ended.

+I see much much less property porn on TV. It used to be none stop.

+I saw a newspaper article that had 'house price crash' as the lead on the front page and this was a few months ago.

Main stream financial news (credit crunch):

+ Debt levels are being talked about but not a flood of stories, I think that is to come.

+ There are not major job losses but they have definately increased and the athmosphere has turned from prosperity to holding on.

+ Inflation is high and not falling to 2%.

+ America seems in trouble and I don't yet know how this will play out.

+ Credit is definitely drying up, I've seen a lot of talk about charging for banking.

Financial - Investment:

+ Lots of people are talking about recession & redundancy. the big cash wins from speculating are drying up

- the yen carry trade is continuing but for other currencies

My Personal view:

+ I still plan to buy but in 2-3 years at least as everyone I know who's trying to sell is having problems so I'm waiting for fire sale prices. I stlll don't monitor house prices as life is too short for that and I'm safe as I am.

Interest rates:

Up from 5.25% to 5.75% and expected to hit 6% in the media which means expect 7% they are going to start biting hard. Note 1 yr before my first post they where 3.5%. A 100% increase in 4 years which for those taking out 5 year fixes are 3.5% must be a scary thought

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A post from a bull (nick22abdn) and they had a point, I just didn’t want to invest in property

I love reading the occasional old post - shows how much has changed. Maybe selling your property in 2004 was a good idea for your area but you really can't say that your money would not have been better invested wisely in property.

Take Aberdeen, you could have bought a one bed flat for about 40k, now selling for 100k. Rental market has had a severe shortage of one beds for the last few years - all have been rented inside a week, currently achieving 525 pcm. That would be a 15% yield in the last year. If you put a 20% deposit down you would have seen a 750% return on your money. You could easily have bought 2 flats, investing 16k and making 120k.

Don’t harp on about how clever you were to have STR in 2004. You may have made the right call by selling in your area, but made a severe mistake not reinvesting this in a higher growth area for the last 3 years

-------------------------------------------------------------------------------------------------------

Another update

People called me an idiot for selling (Nov 2004):

• I'm still so glad I sold as my standard of accomodation has been so much higher. Presently paying £595/month in a 197K apartment that is better than anything I ever dreamed of living in (In my area a 4 bed detached is 160K). Next door are 6 new bulids almost finished for sale at 1/2 million.

• People only ask me when I plan to buy but most avoid the whole housing subject.

The media:

• It's become negative with talk about annual price falls but property gets much less column inchs now.Have noticed a lot of articles about real inflation e.g. the price of a paper selected basket of goods going up 8-10%.

• Property porn is a seldom used term and people have lost interest in those programs.

• Overall they have become quiet rather than negative.

Main stream financial news (credit crunch):

• Lots of debt stories and the term credit crunch is often used. We're told we are now in one.

• Not a lot of talk about job losses

• Inflation is high and faith in government statistics has fallen considerably.

• America seemed in trouble last update, now it's in trouble and trying to tell us it's almost out of it.

• Credit is still available

Financial - Investment:

A minor crash happened but it was lightning quick.

Gold went a little crazy but has gone down since

Oil is up a lot but worse so is food. Talk about food riots in the papers is bad.

not sure if the yen carry trade is still occuring as all financial companies seem to have had big losses.

My Personal view:

I still plan to buy but in 2-3 years (so 3-4 from last time) as buying seems daft at the moment. I think there are some fire sale prices out there but I just don't want to buy yet. I stlll don't monitor house prices or go on this forum as life is too short for that and I'm safe as I am.

Interest rates:

Down to 5% from 5.75%, all hints are expect them to stay pat and then go up but a recession feels imminent and at that point they should fall. This is the point we need 3.5% rates not in 2004, I can see the faults the central bank made now more clearly.

I'm gonna keep renting and basically not caring about house prices, investments or anything like that. I'm debt free, have cash/gold as savings and just ignore house prices. I'm keeping my pension contributions going but they are going into mainly cash & 20% commodities at the moment and will do for a year or so as I'm worried about a more major crash.

I hope all those bears who sold are doing fine and the bulls are getting some good fire sale price deals.

-------------------------------------------------------------------------------------------------------

A reply from HPC guru in Feb 2007 I added as interesting.

I STRd in December 2003. Top of the market ... almost. I think my house might have sold for more in Spring/Summer 2006 - other than that in 2004/5 it would have sold for 10% less than I got for it in 2003. Now I think if it sold - the market here just seems to be completely stagnant - it would go for 5% to 10% less than I sold for in 2003.

I would freely admit that in 2006 - following the base rate cut in August 2005 and the market boom in Spring 2006 - I thought I'd made a mistake and that, somehow - against logic, the boom could continue. But it hasn't.

The central bankers are idiots. If they had left interest rates alone in August 2005, the correction which was well under way would have continued for a year or two, property would have fallen gently back to more affordable levels, and we would have avoided a bust. Now I am much more worried about a recession and jobs than I am about house prices.

-------------------------------------------------------------------------------------------------------

June 2008 – a reply from Dr Bubb, feel free to skip as he is a gold bug

QUOTE (Who Knows @ Jun 5 2008, 10:19 AM)

Now I only skim read the thread but as I have stated about 100 times. If you STR'd in 2003/4/5 and stuck the cash in a jam jar you are an idiot. If you had a strategy that allowed your STR fund to grow in proportion to the local market ( eg to within 20K of peak prices) then you are on to a winner. Simple.

Absolutely true.

And even 2001 was a great time to STR, provided you invested in Gold shares near

the 2001 low. That's what I did.

So one modestly-financed lower ground flat on an obscure street in Kensington,

has been "traded up", to two portfolios:

+ 2/3rds: Mining and Resource shares which generated a 7-figure profit in 2007,

+ 1/3rd : Ten flats in Hong Kong, financed at less than 60% of value

I laugh at all those idiots (here and on other sites), who said I must be upset at

getting "priced out" of Kensington. The best of my HK flats are both worth more

than the dump I sold-to-rent in Kensington in 2001. And that dump is losing money

every day now, while my two portfolios rise.

-------------------------------------------------------------------------------------------------------

The last ever reply and I think was some sort of con

It is very unlikely that the prices will drop. Once the home prices go up, they tend to stay up the same or go higher. They rarely ever go down.

John Beck's Free & Clear Real Estate System

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Fifth post September 2010

This is the post when I copied my previous posts to this new post. The atmosphere is so very different. We are in a recession and talk is about a double dip, through nobody is saying that is definite.

I almost feel that talking about house prices is worthless as the real issue is the recession. People losing jobs, 25% cuts in social services and the feeling that everything might not be ok in the world.

But to continue the theme I’ll do an update based on property alone.

People called me an idiot for selling (Nov 2004):

• This is old news. I’ve kept the money I made from seeling and increase it by a little, basically inflation.

The media:

• Lots of doom and gloom last year but now back to which footballer shagged which pop star

Main stream financial news (credit crunch):

• We are in a recession; things are very bad in America.

• Big problems with food inflation due to flooding in Russia and India hence emergency meeting by the UN. I wonder if this will develop into a major worldwide issue as we all have to eat.

• Inflation is stubbornly high even with extremely low 0.5% interest rates.

• PIIGS (Portugal, Ireland, Iceland, Greece and Spain) was big last year but currently talk is about Ireland having major issues and about more terrorism from Ireland expected.

• Credit is no longer available unless you don’t need it. Some investor just bricked up the door to a bank in protest.

Financial - Investment:

Gold bugs are laughing as gold > $1,000 I think around $1,200 at the moment.

Since a big stock market crash everything has gone stable for the moment my gut feeling is another crash a la 1930 might be coming. But unwilling to move investments to take advantage as not that sure.

My Personal view:

Some people are struggling but could be worse. At least there is no major war through the war on terror seems to have become a war on Afganistan (after Iraq fell) and there is talk about Iran too.

Interest rates:

0.5% I believe. In 2004 they thought 0.5% interest rates would’ve tripled house prices in a year. How things change.

Andrew

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Give us the street and town and we can look up the sold prices on the internet to see if you were right and got in yours words "Top ceiling price" in 2004"

F**k me.

You did well picking that out of the OP.

I simply couldn't be ar$ed.

No doubt the OP's sense of importance and entitlement leads them to believe that they deserve 20 mins of my life, reading their self-absorbed cobblers. But let's face it, if the thread/s were that interesting, then they/it would still be on the front page all these months later.

Hope it was a good use of your time, all that cutting and pasting. Are you AbsoluteTurdo by any chance? (Looks like you don't have much of a proper job / life / relationship / kids / etc to keep you going!!)

B

(And no, I won't be bothering to bump your exceedingly dull thread, should you choose to get all ar$ey....)

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I’m resurrecting my first ever post from 2004 so six years ago. My point at the time was to try to show the public opinion of the time and then update it every 12-18 months. You may or may not find it interesting but in 2004 we were in the grip of the housing boom.

Unfortunately my first ever post has been deleted and in case others start getting removed due to age I’ve started again. I’ve included an update including all of them I could find. The original start at http://www.housepricecrash.co.uk/forum/index.php?showtopic=3141&st=0

I’ve tried to highlight the most interesting points

2004 post (now deleted)

It started after I sold my house. I’d brought it in 2000 for the princely sum of £39,950 and sold it in Sept 2004 for £86,000. I know some monetary history hence my statement at the time was:

<quote>

For the record I gained 110% on my house in 4 years, with a 95% mortgage so with 20/1 gearing I got a 1,100% increase on investment. I know that should be impossible since growth + inflation = ~4% a year. I worked out that if I could maintain that gearing, impossible I know but the rest is the same, after 20 years I could buy everything in britain (58 trillion), after 23 years everything in the world 1 zillion (or whatever comes after trillion). By 107 year I have more pounds then there are atoms in the universe. I think the growth in house prices at least in my area are unrealistic.

</quote>

At the time people with no investment experience such as my sister and best friend were talking to me about getting into buy to let. The view was if you had enough cash or could get credit it was a license to get into BTL and print money.

The only property porn program I watched was Sarah Beenies. 90% of them were newbies who made massive mistakes but still made a fortune due to the raising market. Generally along the lines of buy for 150K, budget 30K for improvements and sell for 210K. It’d end up costing 90K and take 9 months not 9 weeks but they’d sell it eventually for 300K and make a 60K profit.

Second post July 2006

Time for an update on my first ever post (remember 18 months have passed):

People called me an idiot for selling:

+Friends&Familly now say I sold at the right time and I wasn't an idiot (I still have ceiling price on the road)

+ They believe prices are lower now (maybe regional) especially nice detached houses

- They think that since the top end houses have fallen & the market is full of them I should consider buying in the next year or two.

The media:

+ It's changed a lot, the number of housing programs has dropped, property ladder especially has changed.

+ I actually see articles talking about possible house price falls

+ Halifax stated house prices fell 1.2% (Lots of people around me noticed this, i ignored it)

- We haven't yet seen the phrase "Crash" used by a newspaper for a prominant article.

Main stream financial news (credit crunch):

+ I keep seeing articles about debt levels being too high

+ People are telling me they wish they didn't have so much debt (and point out it could've been avoided)

- The credit is still available and self cert/high risk mortgages are still available.

Financial - Investment:

+ The price of gold/oil is up a lot (gold ~50%, oil ~40% averaged out)

+ People who I mentioned a possible recession to last year are now telling me about it as if it's there idea

- The media is still bullish and everyone thinks they deserve to make big bucks meaning money is still flowing in.

My Personal view:

+ I'm happy I sold the house and happy I recently sold my sports car (My inflation hedge last year lol)

+ I didn't miss out on a 20% rise in the house I sold

- I think another 3-5 years before buying a house is a good idea.

-------------------------------------------------------------------------------------------------------

August 2006 Interest rates (reply to a post) for continuity

But some long run views on IR's:

1 year before my first post (boom times around me) - 3.5%

First post IR - 4.75%

18mths later - 4.5%

Today - 4.75%

But historically we track global interest rates especially America's. From my first post to today there rate has gone from 1.75% to 5.25% and if America can raise rates by 4.5% over 23 months we could do the same.

But as I said IR's are only a small part of the story

-------------------------------------------------------------------------------------------------------

August 2006 How to know the bubble has burst (reply to a post)

Hi Immigrant,

How long?

I expect a front page newspaper article in a tabloid announcing "house prices fall for the second month" followed by a graph in the paper showing annual price increases have gone negative in 2007.

My biggest problem is the amount of statistics and VI spin as they might wait until 2008 and then post articles that prices had collapsed in 2007 and are now increasing again. [Edit hasn't something similar to this happened in the last 6 months?]

The Irish Bubble

This is much larger than the British bubble and will fall later, faster and further. From an outsiders point of view it seems more like a ponza scheme than a bubble.

I might be wrong but I thought that the older generation was taking out equity to part fund purchases for the younger generation (there sons & daughters).

This means money from the top of the pyramid flowing back to the bottom very very dangerous.

A quote from george orwells 1984 "the system will eat itself".

Why is my faith so unshakable?

1) Self interest/Greed

Basically if a crash occurs it's good for me so it's much easier for me to believe this will happen. Any Bear who doesn't realise this is fooling themselves.

I'm worse than most since I'm STR and hope to make money on the way up and then buy cheaply on the way down.

2) the dot com boom

I did a long post about this elsewhere HP boom V .Com boom but basically I've seen and felt this euphoria before.

It cost me money to learn that just because everyone's in the same boat doesn't mean the boat won't sink.

3) Historical graphs

Average price to average earnings is a particularty strong argument to me. I just don't think it's different this time.

"Those who do not learn from history are doomed to repeat it".

4) Personal observations

I've seen credit go crazy.

People on half my salary with brand new cars, going on holiday 3 times a year, buying plasma screen Tv's, new kitchens and assorted other stuff. There view of organising finances is getting a consolidation loan with enough left over for a holiday.

Now I'm seeing people talk about how they don't have any money (cards maxed or wisely stopped using them).

I've seen more recently (last 6 mths) people getting worried and counting up the debts.

But the main 100% definate reason for prices to fall is drum roll...............

Everyone said they couldn't imagine prices falling!

Extra: As implied by others inflation can have a factor but in my view after a lot of analysis and thought I believe we are ultimately heading towards deflation not inflation.

Through a short inflationary period (in commodities rather than housing or shares) might occur first. Look on GEI for more details as I posted there and Dr Bubb put up a roadmap which also ended in deflation.

-------------------------------------------------------------------------------------------------------

Third post March 2007

Time for a second update on my first ever post

First post - November 2004

First Update - August 2006 (18 months later)

This update - March 2007 (25 months later or 7 months since the last)

I hope people realise from this just how slowly a housing market changes. In a little over two years a lot has changed.

My notes below compare to 2004.

People called me an idiot for selling (Nov 2004):

+Where I rent is a palace and so much better than anything I ever expected to live in. The general view is I've done very very well.

+A few friends have recently put there houses up for sale as they think it's topped out.

+Heaps of anecdotal stories from friends telling me they think a recession is coming (I told lots of them this 9 months ago).

+Friends&Familly now say I sold at the right time and I wasn't an idiot (I still have ceiling price on the road)

-People are telling me I could've waited longer to sell and made more.

The media:

+ I'm actually reading articles that mention a recession, a slump in America and that house prices could fall. Such a change.

- We haven't yet seen the phrase "Crash" used by a newspaper for a prominant article.

Main stream financial news (credit crunch):

+ Debt levels are being talked about as a problem.

+ The CPI measure is being attacked as not reflecting the true cost of living.

+ People have stopped talking about debt but also don't talk about buying things anymore.

+ A few friends have taken out big re-mortgages not to spend but to clear all other debt and put away for a rainy day.

- The credit is still available but getting more expensive and BTL mortgages are demanding higher deposits/fees.

Financial - Investment:

+ The price of gold/oil has gone up and doesn't look as if it's coming down ever (no more $30 oil or $300 gold).

+ People who I mentioned a possible recession to last year are now telling me they are seeing the evidence (falling activity/order books)

+ The media has lost it's bullish stance and are talking about the carry trade unwinding/recessions.

My Personal view:

+ I don't monitor house prices anymore and haven't posted on here for months as I don't care what happens since I'm safe.

+ I'm now certain a crash is coming but it might be 2008 before it really hits.

- I think it'll be another 5-7 years before buying a house is a good idea (it's gonna be worse than I'd originally expected)

Interest rates:

Up from 4.75% to 5.25% and expected to keep rising. Note 1 yr before my first post they where 3.5%. A 50% increase in 3 years.

I'm gonna keep renting and basically not caring about house prices, investments or anything like that. I'm debt free, have cash/gold as savings and just ignore house prices. I am considering reducing my pension contributions for a few years and saving the cash to use later.

-------------------------------------------------------------------------------------------------------

Fourth post July 2007 (Earlier than normal)

People called me an idiot for selling (Nov 2004):

+It was honestly the best move I have ever made and gave me great joy to be out of a shit hole in a bad area and renting in a palace.

+Lots of people are stressed about housing and are jealous of the fact I have zero stress about housing.

-I no longer have ceiling price on my street. The people who bought my house sold it in 2007 for 3 grand more. Nothing else has sold. I'm still glad I sold as I now know i did not miss out on the supposed 20% increase in house prices after I sold it.

The media:

+I read articles about house prices falling, BTL in particular flats being a bad idea and the whole housing being a one way bet has ended.

+I see much much less property porn on TV. It used to be none stop.

+I saw a newspaper article that had 'house price crash' as the lead on the front page and this was a few months ago.

Main stream financial news (credit crunch):

+ Debt levels are being talked about but not a flood of stories, I think that is to come.

+ There are not major job losses but they have definately increased and the athmosphere has turned from prosperity to holding on.

+ Inflation is high and not falling to 2%.

+ America seems in trouble and I don't yet know how this will play out.

+ Credit is definitely drying up, I've seen a lot of talk about charging for banking.

Financial - Investment:

+ Lots of people are talking about recession & redundancy. the big cash wins from speculating are drying up

- the yen carry trade is continuing but for other currencies

My Personal view:

+ I still plan to buy but in 2-3 years at least as everyone I know who's trying to sell is having problems so I'm waiting for fire sale prices. I stlll don't monitor house prices as life is too short for that and I'm safe as I am.

Interest rates:

Up from 5.25% to 5.75% and expected to hit 6% in the media which means expect 7% they are going to start biting hard. Note 1 yr before my first post they where 3.5%. A 100% increase in 4 years which for those taking out 5 year fixes are 3.5% must be a scary thought

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A post from a bull (nick22abdn) and they had a point, I just didn’t want to invest in property

I love reading the occasional old post - shows how much has changed. Maybe selling your property in 2004 was a good idea for your area but you really can't say that your money would not have been better invested wisely in property.

Take Aberdeen, you could have bought a one bed flat for about 40k, now selling for 100k. Rental market has had a severe shortage of one beds for the last few years - all have been rented inside a week, currently achieving 525 pcm. That would be a 15% yield in the last year. If you put a 20% deposit down you would have seen a 750% return on your money. You could easily have bought 2 flats, investing 16k and making 120k.

Don’t harp on about how clever you were to have STR in 2004. You may have made the right call by selling in your area, but made a severe mistake not reinvesting this in a higher growth area for the last 3 years

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Another update

People called me an idiot for selling (Nov 2004):

• I'm still so glad I sold as my standard of accomodation has been so much higher. Presently paying £595/month in a 197K apartment that is better than anything I ever dreamed of living in (In my area a 4 bed detached is 160K). Next door are 6 new bulids almost finished for sale at 1/2 million.

• People only ask me when I plan to buy but most avoid the whole housing subject.

The media:

• It's become negative with talk about annual price falls but property gets much less column inchs now.Have noticed a lot of articles about real inflation e.g. the price of a paper selected basket of goods going up 8-10%.

• Property porn is a seldom used term and people have lost interest in those programs.

• Overall they have become quiet rather than negative.

Main stream financial news (credit crunch):

• Lots of debt stories and the term credit crunch is often used. We're told we are now in one.

• Not a lot of talk about job losses

• Inflation is high and faith in government statistics has fallen considerably.

• America seemed in trouble last update, now it's in trouble and trying to tell us it's almost out of it.

• Credit is still available

Financial - Investment:

A minor crash happened but it was lightning quick.

Gold went a little crazy but has gone down since

Oil is up a lot but worse so is food. Talk about food riots in the papers is bad.

not sure if the yen carry trade is still occuring as all financial companies seem to have had big losses.

My Personal view:

I still plan to buy but in 2-3 years (so 3-4 from last time) as buying seems daft at the moment. I think there are some fire sale prices out there but I just don't want to buy yet. I stlll don't monitor house prices or go on this forum as life is too short for that and I'm safe as I am.

Interest rates:

Down to 5% from 5.75%, all hints are expect them to stay pat and then go up but a recession feels imminent and at that point they should fall. This is the point we need 3.5% rates not in 2004, I can see the faults the central bank made now more clearly.

I'm gonna keep renting and basically not caring about house prices, investments or anything like that. I'm debt free, have cash/gold as savings and just ignore house prices. I'm keeping my pension contributions going but they are going into mainly cash & 20% commodities at the moment and will do for a year or so as I'm worried about a more major crash.

I hope all those bears who sold are doing fine and the bulls are getting some good fire sale price deals.

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A reply from HPC guru in Feb 2007 I added as interesting.

I STRd in December 2003. Top of the market ... almost. I think my house might have sold for more in Spring/Summer 2006 - other than that in 2004/5 it would have sold for 10% less than I got for it in 2003. Now I think if it sold - the market here just seems to be completely stagnant - it would go for 5% to 10% less than I sold for in 2003.

I would freely admit that in 2006 - following the base rate cut in August 2005 and the market boom in Spring 2006 - I thought I'd made a mistake and that, somehow - against logic, the boom could continue. But it hasn't.

The central bankers are idiots. If they had left interest rates alone in August 2005, the correction which was well under way would have continued for a year or two, property would have fallen gently back to more affordable levels, and we would have avoided a bust. Now I am much more worried about a recession and jobs than I am about house prices.

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June 2008 – a reply from Dr Bubb, feel free to skip as he is a gold bug

QUOTE (Who Knows @ Jun 5 2008, 10:19 AM)

Now I only skim read the thread but as I have stated about 100 times. If you STR'd in 2003/4/5 and stuck the cash in a jam jar you are an idiot. If you had a strategy that allowed your STR fund to grow in proportion to the local market ( eg to within 20K of peak prices) then you are on to a winner. Simple.

Absolutely true.

And even 2001 was a great time to STR, provided you invested in Gold shares near

the 2001 low. That's what I did.

So one modestly-financed lower ground flat on an obscure street in Kensington,

has been "traded up", to two portfolios:

+ 2/3rds: Mining and Resource shares which generated a 7-figure profit in 2007,

+ 1/3rd : Ten flats in Hong Kong, financed at less than 60% of value

I laugh at all those idiots (here and on other sites), who said I must be upset at

getting "priced out" of Kensington. The best of my HK flats are both worth more

than the dump I sold-to-rent in Kensington in 2001. And that dump is losing money

every day now, while my two portfolios rise.

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The last ever reply and I think was some sort of con

It is very unlikely that the prices will drop. Once the home prices go up, they tend to stay up the same or go higher. They rarely ever go down.

John Beck's Free & Clear Real Estate System

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Fifth post September 2010

This is the post when I copied my previous posts to this new post. The atmosphere is so very different. We are in a recession and talk is about a double dip, through nobody is saying that is definite.

I almost feel that talking about house prices is worthless as the real issue is the recession. People losing jobs, 25% cuts in social services and the feeling that everything might not be ok in the world.

But to continue the theme I’ll do an update based on property alone.

People called me an idiot for selling (Nov 2004):

• This is old news. I’ve kept the money I made from seeling and increase it by a little, basically inflation.

The media:

• Lots of doom and gloom last year but now back to which footballer shagged which pop star

Main stream financial news (credit crunch):

• We are in a recession; things are very bad in America.

• Big problems with food inflation due to flooding in Russia and India hence emergency meeting by the UN. I wonder if this will develop into a major worldwide issue as we all have to eat.

• Inflation is stubbornly high even with extremely low 0.5% interest rates.

• PIIGS (Portugal, Ireland, Iceland, Greece and Spain) was big last year but currently talk is about Ireland having major issues and about more terrorism from Ireland expected.

• Credit is no longer available unless you don’t need it. Some investor just bricked up the door to a bank in protest.

Financial - Investment:

Gold bugs are laughing as gold > $1,000 I think around $1,200 at the moment.

Since a big stock market crash everything has gone stable for the moment my gut feeling is another crash a la 1930 might be coming. But unwilling to move investments to take advantage as not that sure.

My Personal view:

Some people are struggling but could be worse. At least there is no major war through the war on terror seems to have become a war on Afganistan (after Iraq fell) and there is talk about Iran too.

Interest rates:

0.5% I believe. In 2004 they thought 0.5% interest rates would’ve tripled house prices in a year. How things change.

Andrew

Is this an early DrBubb alter ego?

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  • 150 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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