The Masked Tulip Posted January 7, 2011 Share Posted January 7, 2011 Interesting comments on the UK housing market in this article. Worth 2 minutes of your time. http://www.moneyweek.com/investment-advice/share-tips-ten-british-stocks-51528.aspx Quote Link to comment Share on other sites More sharing options...
Conrad Posted January 7, 2011 Share Posted January 7, 2011 Do you care to divulge what those comments are? Quote Link to comment Share on other sites More sharing options...
Lagarde's Drift Posted January 7, 2011 Share Posted January 7, 2011 John S: And what about UK property? Marina: I don't think prices are really going anywhere. Certainly not up. It's a buyers' market. John M: I think prices are about to collapse. John S: Why? John M: I think they are hugely overvalued. Look at where interest rates are. Look at the rate you currently pay on your mortgage, compared to what that rate has been historically and what it could do in the future. If interest rates went up it would cripple the housing market. Mattias: Which is why rates won't go up, I guess. I agree with you on house prices. But surely it's difficult to be constructive on the economy as a whole if you think house prices are going to collapse? John M: Not really. If we agree that the economy could export its way out of trouble, then it's not nearly as bad as you think. You have to remember that the vast bulk of the population didn't buy their house last week. They bought at a range of times. But the reality is that everybody knows they are massively overvalued – the affordability factor is dead simple. Mike S: But there will be huge regional divergence, won't there? The South East will be protected because we are relatively light on public-sector exposure. John M: Only Central London, because there are a lot of overseas buyers. Mattias: But that's very concentrated. John M: It's concentrated, yes, but it radiates out, because people spend an awful lot when they buy a house. These people will come in and buy £25m houses in Belgravia, and spend another £25m getting them sorted out. But once you get further out into the southeast, the impact diminishes, depending on how far you go. Mike S: I'll settle for 0%-5% down. John M: I think you will actually find they will all just crunch. Mattias: They do look a little bit expensive to me, as a foreigner. John M: They crunched on the way up – and they will crunch on the way down. Really worth 2 minutes? Quote Link to comment Share on other sites More sharing options...
The Masked Tulip Posted January 7, 2011 Author Share Posted January 7, 2011 Really worth 2 minutes? Cup of tea, dunk a custard cream. Quote Link to comment Share on other sites More sharing options...
tim123 Posted January 7, 2011 Share Posted January 7, 2011 John M: Only Central London, because there are a lot of overseas buyers. Mattias: But that's very concentrated. John M: It's concentrated, yes, but it radiates out, because people spend an awful lot when they buy a house. These people will come in and buy £25m houses in Belgravia, and spend another £25m getting them sorted out. I don't get this. How does the fact that some rich numpty is prepared to spend 50M on a house in Belgravia "radiate out"? There are only a few areas where someone with 50M to blow wants to live and the people he displaces are not going to be influencing prices in e.g. Croydon tim Quote Link to comment Share on other sites More sharing options...
SomethingHasToGive Posted January 7, 2011 Share Posted January 7, 2011 I don't get this. How does the fact that some rich numpty is prepared to spend 50M on a house in Belgravia "radiate out"? There are only a few areas where someone with 50M to blow wants to live and the people he displaces are not going to be influencing prices in e.g. Croydon The £25M goes to interior designers, architects, builders and suppliers of building materials. They spend it on cheaper services from other people etc etc. However £25M of pointless waste doesn't go very far when you are buying gold windows and diamond studded loo roll. Quote Link to comment Share on other sites More sharing options...
rantnrave Posted January 7, 2011 Share Posted January 7, 2011 The phenomenon of foreigners snapping up London properties is being exacerbated by Sterling's weakness. Hopefully even a token rise in IRs will give the Pound a boost and make overseas' investors in London property the jitters. Quote Link to comment Share on other sites More sharing options...
tomandlu Posted January 7, 2011 Share Posted January 7, 2011 The phenomenon of foreigners snapping up London properties is being exacerbated by Sterling's weakness. Hopefully even a token rise in IRs will give the Pound a boost and make overseas' investors in London property the jitters. ... which, along with the export boost, is probably another reason they'll try and hold IRs down. It's sort-of scary to think that we are being deprived of affordable housing for this*... sigh... see my sig. * and the really scary thing is how much sense it makes (sort of) Quote Link to comment Share on other sites More sharing options...
rantnrave Posted January 7, 2011 Share Posted January 7, 2011 ... which, along with the export boost, is probably another reason they'll try and hold IRs down. It's sort-of scary to think that we are being deprived of affordable housing for this*... sigh... see my sig. * and the really scary thing is how much sense it makes (sort of) Maybe London will end up being like Venice. All the locals end up moving out because they can't afford to live and work there. The property ends up catering to tourists... Quote Link to comment Share on other sites More sharing options...
@contradevian Posted January 7, 2011 Share Posted January 7, 2011 (edited) Maybe London will end up being like Venice. All the locals end up moving out because they can't afford to live and work there. The property ends up catering to tourists... Thats already happened. You have to stupendously rich to live in London or technically very "poor" and live in social housing. I say technically as its not just the poor that can wangle social housing (council officials, peers of the realm and so on). If you are white and a middle earner its a lockup garage in Romford or Croydon for you. Edited January 7, 2011 by Sir John Steed Quote Link to comment Share on other sites More sharing options...
winkie Posted January 7, 2011 Share Posted January 7, 2011 Thats already happened. You have to stupendously rich to live in London or technically very "poor" and live in social housing. I say technically as its not just the poor that can wangle social housing (council officials, peers of the realm and so on). If you are white and a middle earner its a lockup garage in Romford or Croydon for you. Most of the 20 to 35 somethings are either living with parents or renting the rest move out unless in the categories above......you require a megga deposit now to buy in London/Greater London....who wants to be a slave to a roof over their heads? Quote Link to comment Share on other sites More sharing options...
@contradevian Posted January 7, 2011 Share Posted January 7, 2011 <br />Most of the 20 to 35 somethings are either living with parents or renting the rest move out unless in the categories above......you require a megga deposit now to buy in London/Greater London....who wants to be a slave to a roof over their heads? <img src='http://www.housepricecrash.co.uk/forum/public/style_emoticons/default/wink.gif' class='bbc_emoticon' alt='' /><br /><br /><br /><br />Yes if you can put up with sharing and want to live like "men behaving badly" for the rest of your life, then central london is kind of affordable (almost). Quote Link to comment Share on other sites More sharing options...
danlee74 Posted January 7, 2011 Share Posted January 7, 2011 Didn't read the article (beyond what was pasted in the thread) but skipped to the one comment ... interesting: / SNIP I can also tell you as a UK manufacturer that the inflation that is on its way is massive and looking a lot less easy to shift than last time. Since returning from the Christmas break this week I have been hit with massive price increases from all of my major suppliers and I am not talking one or two percent here but 10, 12 and even 25%!!!! Whether or not the B of E want to raise rates or not is irrelevent because they will soon have no choice and where will that leave house prices and the so called recovery then? / END OF SNIP One of us???! Quote Link to comment Share on other sites More sharing options...
winkie Posted January 7, 2011 Share Posted January 7, 2011 Yes if you can put up with sharing and want to live like "men behaving badly" for the rest of your life, then central london is kind of affordable (almost). Nothing wrong with renting and or sharing it can be fun, you are free and flexible.....but you reach a point when you think what next, life is passing by, might want to settle down etc...what then? to buy a place even with two full time good salaries is no easy feat.....settled down people may want children, then what? Quote Link to comment Share on other sites More sharing options...
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