Jump to content
House Price Crash Forum
Sign in to follow this  
othello

Death By A Thousand Cuts

Recommended Posts

I had thought until recently that the house market would crash and by that I mean fall 25-30% on average from peak prices over 1 or 2 years. I am now leaning towards the scenario of a gradual decline in property values over the next 7-8 years before starting to pick up again. The net fall will take a lot longer but could be greater after taking account of inflation. I think this type of stagflation is the worst possible outcome for people wanting to buy or sell houses and for the broader economy.

Why do I think this is the likely future path and not one of a period of stabilisation? Firstly because we have never seen such a period of stabilisation. Secondly because economic indicators (debt, unemployment, inflation) are all pointing in the direction that would precitipate a fall.

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

Share this post


Link to post
Share on other sites

I had thought until recently that the house market would crash and by that I mean fall 25-30% on average from peak prices over 1 or 2 years. I am now leaning towards the scenario of a gradual decline in property values over the next 7-8 years before starting to pick up again. The net fall will take a lot longer but could be greater after taking account of inflation. I think this type of stagflation is the worst possible outcome for people wanting to buy or sell houses and for the broader economy.

Why do I think this is the likely future path and not one of a period of stabilisation? Firstly because we have never seen such a period of stabilisation. Secondly because economic indicators (debt, unemployment, inflation) are all pointing in the direction that would precitipate a fall.

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

I don't know why, but I seem to agree with your theory. During the 90's crash things did move much quicker..we didn't get a long period of stability and then a sharp drop, but within a matter of a few months we began to have sharp declines. Seems different now though, with prices bumping along and hardly any drops.

Share this post


Link to post
Share on other sites

I had thought until recently that the house market would crash and by that I mean fall 25-30% on average from peak prices over 1 or 2 years. I am now leaning towards the scenario of a gradual decline in property values over the next 7-8 years before starting to pick up again. The net fall will take a lot longer but could be greater after taking account of inflation. I think this type of stagflation is the worst possible outcome for people wanting to buy or sell houses and for the broader economy.

Why do I think this is the likely future path and not one of a period of stabilisation? Firstly because we have never seen such a period of stabilisation. Secondly because economic indicators (debt, unemployment, inflation) are all pointing in the direction that would precitipate a fall.

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

NO insults as i think what your saying is a likely scenario as is 30% falls in a shorter period of time all we can do is sit back and wait,however long or short it takes i am ready..........

Share this post


Link to post
Share on other sites

The longer the market holds at a higher level the more pressure is building up for harder falls later, we are at historically high levels, with historically high levels of debt with historically low interest rates....

The Debt Boulder is getting bigger every day, the boulder is only trundling down a gentle slope at the moment, but it is starting to pick up pace....

Edited by moosetea

Share this post


Link to post
Share on other sites

The longer the market holds at a higher level the more pressure is building up for harder falls later, we are at historically high levels, with historically high levels of debt with historically low interest rates....

The Debt Boulder is getting bigger every day, the boulder is only trundling down a gentle slope at the moment, but it is starting to pick up pace....

Yes, the cumulative build up of unpayable debt leads to greater levels of default later on in the cycle - which causes more carnage for the lenders and effects a wider proportion of the rest of the economy. Flattish pricing is no indication of stability whatsoever.

Share this post


Link to post
Share on other sites

i agree that it could take years for such falls. i think all will be dictated by the economy. unlike equities, HPC wont happen on its own. it could be 2/3 years before a recission...and thats what we will need before a HPC

Share this post


Link to post
Share on other sites

Guys the crash is well and truely back on. Why?

Stocks are crashing around the globe on the back of inflation fears and a stagnating (and globe) housing bubble. This will further weeken US consumer spending. Which will further hit employment, which will, blah blah.... you know what I mean. Hurricane Wilma is going to be splashed all over the US Breakfast news this moring. When they went to bed it was a Tropical Storm!

America will feel like it is under economic seige! I would in their position.

Recession next year. No doubt. Wave bye bye to the housing market!

Note I have not posted a smilly because some of us could loose are jobs in all of this!

Good luck guys.

Share this post


Link to post
Share on other sites

I had thought until recently that the house market would crash and by that I mean fall 25-30% on average from peak prices over 1 or 2 years. I am now leaning towards the scenario of a gradual decline in property values over the next 7-8 years before starting to pick up again. The net fall will take a lot longer but could be greater after taking account of inflation. I think this type of stagflation is the worst possible outcome for people wanting to buy or sell houses and for the broader economy.

Why do I think this is the likely future path and not one of a period of stabilisation? Firstly because we have never seen such a period of stabilisation. Secondly because economic indicators (debt, unemployment, inflation) are all pointing in the direction that would precitipate a fall.

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

Totally concur, I`ve never predicted a crash, it suggests immediacy, wrong description. Fall in values? Yep over a 4 year period.

Edited by Converted Lurker

Share this post


Link to post
Share on other sites

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

I don't think you're going to get any insults. Some of the posters here think there will be a sharper decline at some point, but a lot of people share your views.

And even the most apocalyptic posters don't have an unlimited supply of insults, so they save them for the numpties and VI's that believe prices are starting back up again. :lol::lol:

Share this post


Link to post
Share on other sites

stabilisation.

Although it looks like it’s a slow slope – history tells us it won’t be.

My reason for thinking this is – people have bought investments that look like they are going to make lots of money but require lots of time and effort. When they work out they are making a loss and will make a loss every year they will have to sell and most will not be able to pay what they owe – hence panic – and unstoppable crash – we just need a start of 5 –10 thou a year

Share this post


Link to post
Share on other sites

To be honest i am thinking along the same lines now, prices here NW are still so stupid, 3 times overvalued, but still selling, and people paying stupid money. I hope for a big crash, but think it will be a slow drop over 7 years, hope i am wrong though

Share this post


Link to post
Share on other sites

I'm also not sure which way this house price correction will unfold.

As an STR I have a 3 pronged strategy.

1) Buy our final home spending all the budget and borrowing approx 1.5 years salary. Almost impossible at todays prices.

2) Buy an acceptable home spending the budget and borrowing approx 0.5 years salary. Then trade up in approx ten years time.

3) Carry on renting if we can't find a house that fits into option 1 or 2. Don't intend to rent for more than a further 9 months

Share this post


Link to post
Share on other sites

I had thought until recently that the house market would crash and by that I mean fall 25-30% on average from peak prices over 1 or 2 years. I am now leaning towards the scenario of a gradual decline in property values over the next 7-8 years before starting to pick up again. The net fall will take a lot longer but could be greater after taking account of inflation. I think this type of stagflation is the worst possible outcome for people wanting to buy or sell houses and for the broader economy.

Why do I think this is the likely future path and not one of a period of stabilisation? Firstly because we have never seen such a period of stabilisation. Secondly because economic indicators (debt, unemployment, inflation) are all pointing in the direction that would precitipate a fall.

As I said at the start, I am still convinced the market will fall, but I now feel that is going to happen slowly rather than in the form of a sharp correction and that it will affect a lot of people for many years to come.

This may be an unpopular point of view but I'd be interested in other views. No doubt I'll also get a barrage of insults as seems to be the case for those who dare to question the HPC view.

I think you underestimate the others on here if you think what you say would be met by insults. What you say is entirely plausible.

However there are two ways to look at house prices. There's the market average price which is still very high and there's the price you can negotiate for yourself.

Over the coming year it may be entirely possible that the average house price will not drop by 20-30% but I am willing to bet that there will be a few postings from members who have managed to knock 10-15% off on a property that has been on the market for 18-24 months. Perhaps something that when first listed is the equivalent of a further 10-15% drop from peak.

NDL

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 301 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.