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Just Had A Talk With My Friend Who Is An Estate Agent

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He is manager of a local branch and says he has yet to sell a single house since the 20th December! He hardly has any buyers on his books and "off the record" he said this will be a massive crash. I said "what 10% this year", he replied "make that 20%"!

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He is manager of a local branch and says he has yet to sell a single house since the 20th December! He hardly has any buyers on his books and "off the record" he said this will be a massive crash. I said "what 10% this year", he replied "make that 20%"!

It sounds like he is realistic. There are plenty of HPCers that will gladly buy with a 30% discount.

I look on Rightmove in the West Sussex area just for laughs sometimes. Recently I monitored a 2-bed bungalow. It was in a good location and would have normally have commanded 285K but was priced at 240K. All the other bungalows around it are priced at 300-325K. It took 3 months to get an offer. Prices are still unrealistic if that house wasn't snapped up immediately. Even bargains are not attracting buyers. There are a lot of people hoping to exit with their costs covered but their houses will just languish. This thing is building momentum now. Britain going back into recession and the inevitable interest rates hikes and low-risk mortgage lending will create a rush to the exit. I suspect this will last 5 years.

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It sounds like he is realistic. There are plenty of HPCers that will gladly buy with a 30% discount.

I look on Rightmove in the West Sussex area just for laughs sometimes. Recently I monitored a 2-bed bungalow. It was in a good location and would have normally have commanded 285K but was priced at 240K. All the other bungalows around it are priced at 300-325K. It took 3 months to get an offer. Prices are still unrealistic if that house wasn't snapped up immediately. Even bargains are not attracting buyers. There are a lot of people hoping to exit with their costs covered but their houses will just languish. This thing is building momentum now. Britain going back into recession and the inevitable interest rates hikes and low-risk mortgage lending will create a rush to the exit. I suspect this will last 5 years.

If houses drop 20-30% in one year, do you really think that the HPC'ers on here will realy buy then?

Or will they wait until the bottom of the market (which is easy to spot)?

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With low rates this will cap supply but with price rises and little wage growth affordability will worsen. Imagine if the market shrinks this will drive many ea's at the margin under.

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If houses drop 20-30% in one year, do you really think that the HPC'ers on here will realy buy then?

Or will they wait until the bottom of the market (which is easy to spot)?

30% off asking prices and I'll be buying.

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If houses drop 20-30% in one year, do you really think that the HPC'ers on here will realy buy then?

Or will they wait until the bottom of the market (which is easy to spot)?

Probably not and that's exactly why prices overshoot on the way down. It's not possible to spot the bottom which poses a big problem for estate agents and sellers. With prices in decline it takes the pressure off buyers. Why bother buying next year if prices are likely to remain stagnant at best for the next 5 years? During the 90s people wanted to move house but fell into the negative equity trap. There were bargains all around but just not enough cash to clear the mortgage, pay the estate agent and moving costs. Without HPI everything looks like an uphill struggle.

Edited by Xurbia

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30% off asking prices and I'll be buying.

40% and I may take a chance. That's 40% off today's asking prices, not last year's ;).

Don't forget, whatever you pay today will seem expensive in a couple of years.

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During the 90s people wanted to move house but fell into the negative equity trap. There were bargains all around but just not enough cash to clear the mortgage, pay the estate agent and moving costs. Without HPI everything looks like an uphill struggle.

That is so true...it really is an expensive game to move house. When prices are rising these unavoidable costs are factored in and then forgotten about, when the profit/lucre was counted. Now these moving costs look huge, along with other negatives when weighed up against reasons for moving.

Just one reason why people are going to be living in one place now for much, much longer.

Edited by GinAndPlatonic

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Chatting to an estate agent the other night an she says the mentality is changing, sellers accepting 5-10k under home report valuation and then buying at 5-10k below.

Edinburgh area.....and she says quite busy.

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Jeez Louise, give it 6 months and people will be kicking themselves that they didn't accept an offer just 20% off of their asking price.

People often suggest I am lacking in sympathy but as I always say, why should I feel sympathy for somebody simply because they are an idiot?

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That is so true...it really is an expensive game to move house. When prices are rising these unavoidable costs are factored in and then forgotten about, when the profit/lucre was counted. Now these moving costs look huge, along with other negatives when weighed up against reasons for moving.

Just one reason why people are going to be living in one place now for much, much longer.

It will get much worse if unemployment climbs much higher. Those trapped with negative equity will be forced to give the keys back. They can then look forward to 5 years of stagnation or declines without the ability to to purchase a bargain. History has a wonderful time repeating itself. The government is not in a position to underpin this mess any longer.

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takes the pressure off buyers. Why bother buying next year if prices are likely to remain stagnant at best for the next 5 years? During the 90s people wanted to move house but fell into the

Err...because with ZIRP, buying is cheaper than renting + the freedom to do what you want to the house...

If a house is to be bought to be lived in and bring up family, then price changes shouldn't be the prime consideration (just like

nobody who buys a car worries that the car will worth less tomorrow).

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Err...because with ZIRP, buying is cheaper than renting + the freedom to do what you want to the house...

If a house is to be bought to be lived in and bring up family, then price changes shouldn't be the prime consideration (just like

nobody who buys a car worries that the car will worth less tomorrow).

Zero interest mortgage :rolleyes:.

Renting is cheaper than buying for me, ask and I will explain again ;).

What have cars got to do with it :rolleyes:.

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Err...because with ZIRP, buying is cheaper than renting + the freedom to do what you want to the house...

If a house is to be bought to be lived in and bring up family, then price changes shouldn't be the prime consideration (just like

nobody who buys a car worries that the car will worth less tomorrow).

House prices are declining. Very few mortgages are being written and you need a huge deposit. You might be able to buy but all your disposable income will be sucked dry. If you're then made unemployed you cannot move. That 'home' will seem like hell.

If you buy for 300k and the house loses 30% it will seem like the most expensive rental in history. The economic outlook is about as bleak as it was in the early 90s. Are you anticipating a quick recovery for Britain?

You car and home analogy doesn't work for me. I'd buy a Merc or a VW before a Citroen, so I do worry about depreciation. It's the biggest cost of owning a car! A home is completely different. People in Britain aspire to be homeowners and assume that they will always rise in value. They are in for a big shock.

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Err...because with ZIRP, buying is cheaper than renting + the freedom to do what you want to the house...

If a house is to be bought to be lived in and bring up family, then price changes shouldn't be the prime consideration (just like

nobody who buys a car worries that the car will worth less tomorrow).

You are making the mistake that so many have made in the last decade: ZIRP does not mean cheap.

I think it's LuckyOne who wrote last week that the typical cost of insuring against rate moves for 25 years was something like 4.5% (IIRC).

That is the REAL cost of the mortgage e.g. whatever you pay for a tracker plus the 4.5% rate insurance.

Most people decide not to pay the insurance but it doesn't make the tracker rate any cheaper: they just decided not to pay for the rate risk protection.

Don't confuse the two or you'll end like the lot that got crucified in the 90s: repossessed not knowing what happened to you.

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House prices are declining. Very few mortgages are being written and you need a huge deposit. You might be able to buy but all your disposable income will be sucked dry. If you're then made unemployed you cannot move. That 'home' will seem like hell.

If you buy for 300k and the house loses 30% it will seem like the most expensive rental in history. The economic outlook is about as bleak as it was in the early 90s. Are you anticipating a quick recovery for Britain?

You car and home analogy doesn't work for me. I'd buy a Merc or a VW before a Citroen, so I do worry about depreciation. It's the biggest cost of owning a car! A home is completely different. People in Britain aspire to be homeowners and assume that they will always rise in value. They are in for a big shock.

If you buy for £300,00 and prices drop by 10% it's a blooming expensive rental!

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Eh? Renting is cheaper for me if prices don't fall at all ;).

I get buyer's remorse when I buy the wrong pair of jeans! :lol:

You can imagine the upcoming phonecalls between parents and children:

Mum: "You know that 50k deposit we lent you? Well, we need it back for retirement."

Child: "There's nothing left. I've lost it all."

Mum: "Your Father will give you a thrashing for this, you imbecile."

:lol:

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  • 312 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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