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House Prices To Fall, Homeowners Told

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On the bottom right hand corner of today's Guardian front page.

"New figures reveal that property values are rising at their slowest rate since 1996, prompting warnings to homeowners to brace themselves for a period of falling house prices. Data from the Office of the Deputy Prime Minister and two of Britain's mortgage lenders indicate that prices are still rising modestly, with the ODPM saying prices increased in July by 4% compared with 5% in June - considerably down on the double-figure rises experienced last summer. But analysts say the reality is that the market is in decline. All regions bar Northern Ireland have seen a sharp decline in house price inflation in the past year."

On page 25 they have a full page map of the UK whose headline says

"City says homeowners should be braced for period of falling prices"

Article here:

Guardian 13th September 2005

Very bearish article!

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Many amateur BTL fools are suddenly going to find out that yield is something very important.

Many of them were led to believe that it didn't matter, that all you did was watch the price go up.

Well that's not investing, that's called gambling.

From now on, for many years, we are going to read disaster stories about property.

The boom will quickly become a distant memory, just as the 90's crash has become.

The ones who decide to "hang on" until the market recovers, are going to spend much of their lives subsidising others, and regretting some very foolish investments.

Edited by BandWagon

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In the same way that many people were brutalised into buying by the media's constant talk of soaring prices, new paradigms and boating missing, who on Earth among Joe Public is going to chance buying when faced with more and more media coverage like this?

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"The best guide to the housing market is to look at the actual prices of homes sold.

Two friends.

One with a probate situation took a 50k hit on his mums house - originally on for £330k.

The other chap is just about to complete with a sale in Hampstead. He has also take a hit - down from £325k to £270k. It has taken him 14 months to date.

I did warn them . :huh:

If they dont kill themselves first

No chance, they have no shame. There is a fair to good chance that they will get a slap from somebody.

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Welcome back DrBubb, good to see you here again :)

All this year I've been saying to people I believe the housing market is in trouble. All this year I've been replied to with blank looks, little chuckles and knowing smiles that prices could never go down.

That's now stopped. People have started to tell me they think I could be right.

News like this on the front page is going to be tough for some people to take but for most of us it is good news indeed.

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Bovis Homes said yesterday its interim profits before tax fell 32%, blaming the fall on lower sales of four- to five-bedroom houses because of weak consumer confidence. Chief executive Malcolm Harris said: "It's cheaper to buy than to rent in most parts of the country. Affordability is not the issue. It is really confidence and the ability of people to sell their homes into the second-hand market."

Most parts of which country.

Another CE that doesn't know his a*** from his e****

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What a wonderful article. More or less exactly what was being said here when the last Halifax figures came out and all the bulls were jubilant.

BTW:Brill pic Doc.

I am however now becoming concerned: when I cam ehere a year ago enthiusiasm (elsewhere) for property was blanket and that was one of my chief reasons for suspecting a top. Now however I tend to take a great deal of my info on property from here (relevant articles invariably appear here first, both bull and bear). I suspect that my contrarian instincts may not be best served by the mood on this site as bearish sentiment becomes the norm. Perhaps the best places to go or to collect info on will be bullish property fora.

Perhaps we should monitor the hit rate on singing pig and channel4 to assess more accurately when property becomes a bad word (ie the time to buy again)? That way the site may still prove useful sentiment wise.

I have no doubt that contrarians such as Doc Bubb will invariably have useful oppinions as, like me, he is watching cycles all the time and changing his bul/bear stance to suit. However, I wonder whether when the contrarians turn bullish, they won't find themselves drowned by the perma-bears.

Just a thought, and imho, not an urgent concern. But like I say, worry early.

Edited by Sledgehead

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