dog Report post Posted October 19, 2005 Bulls and comentators who are feeling smug about recent events might reflect on the anatomy of house crashes. Six months ago we had a buyers strike. This put pressure on some buyers and some sellers. In the end sellers dropped their prices and we saw a rise in sales volumes. Now that the 'have to buy' buyers have bought, we may well see another buyers strike. Next spring house sellers will make another reduction in price and another batch of buyers get what they want. Step by step the market will ratchet down. P.S. This is exactly the kind of crash that lenders can cope with. It is ruinous for the borrowers but safer for the lenders. Quote Share this post Link to post Share on other sites
Guest consa Report post Posted October 19, 2005 Bulls and comentators who are feeling smug about recent events might reflect on the anatomy of house crashes. Six months ago we had a buyers strike. This put pressure on some buyers and some sellers. In the end sellers dropped their prices and we saw a rise in sales volumes. Now that the 'have to buy' buyers have bought, we may well see another buyers strike. Next spring house sellers will make another reduction in price and another batch of buyers get what they want. Step by step the market will ratchet down. P.S. This is exactly the kind of crash that lenders can cope with. It is ruinous for the borrowers but safer for the lenders. The thing is, we need buyers to buy or there will be no crash, an increase in FTB would be good to set the lower prices, every FTB entering the market at knock down prices lowers the average HPI I have said before and I will say it again, the only reason for house prices to show a rise with low numbers of FTB's is that higher end properties are selling, this is happening by the older generation releasing equity and buying, then they rent their previous property out. The stats can show rises throughout the first phase of the downturn and long after, this is why I am not phased by the stupid reports coming out. As soon as the lower end starts to hit realistic prices for FTB's they will start to buy, what happens to HPI when this happens? it plummets. So patience is needed at this time however hard it seems, don't be a gullible sucker fool like the monkey et al. Even the LR figure can be distorted by the high end sales so we need to be vigilant and on the ball, the falls will come. Quote Share this post Link to post Share on other sites
