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theChuz

Property Prices Set To Rise In 2006

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The housing market could see a pick-up in prices by mid 2006 as rising wages make buying a home more affordable, said hometrack.

Ref City News teletext page 502 (channel 4)

So my 3% payrise means i can spend another 3% on a mortgage? Oh wait im getting 3% because of inflation. F*ckin dimwits.

:lol:

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Read the 1989-95 crash news cuttings.

The problem with these forward-looking statements is that Dad gets on my case again.

Why can't these people just shut the f**k up?

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Read the 1989-95 crash news cuttings.

The problem with these forward-looking statements is that Dad gets on my case again.

Why can't these people just shut the f**k up?

Yup and strange how quickly they forget what they have said when a bearish fact is published. When i see the headline on teletext i had to follow it just to find out the justification for the rise.. to have next years payrises as the reason is probably one of the weakest arguments ive heard. Profit warnings galore, inflation on its way up, unemployment increasing. Most companies will be matching inflation and then maybe half a percent on top which will soon be gobbled up by "the coldest winter in a decade" and fuel prices.

It will end in tears :lol: and when i see the tears im going to take the p*ss.

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The Times reports this as

Mr Wrigglesworth expects house prices to fall 4 per cent this year.

However, prices will improve by the middle of next year, assuming stable interest rates and unemployment levels, he added.

This is a very big assumption. I looks like Wriggley is trying to cover his @rse. (loss of confidence?)

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Guest Bart of Darkness
She says she will not be moving unless she gets close to asking price as it is just a life style move and not a necessity ....

She should get nice ans settled then!

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What amazes me about predictions like the one that wrigglesworth has made is that what exactly is he basing it on?

All these so called "experts" predicted last year that the property market would keep on going up & up at a rate of 16%+ a year- that hasnt exactly happened has it?

He is basing this on houses becoming "more affordable" due to pay rises when they are still a very long way from being affordable by 95% of new buyers regardless of a pay rise- I for one would need a pretty big pay rise - Load of old VI cr*p to be honest!!

B)

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... my rule of thumb is offer well below asking price and then if you really really love a place go up to 2.5%ish below ... after that move away to next property as no home is a dream home ... I'll let u know the progress.

My rule of thumb is to laugh a lot at the obviously stupid amount of money people want for houses and do nowt for the next three years. Seems to be working so far.

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My rule of thumb is to laugh a lot at the obviously stupid amount of money people want for houses and do nowt for the next three years. Seems to be working so far.

Same here , except its not a rule of thumb its a way of life :lol: I shrug my shoulders and carry on my way safe in the knowledge that it will all unravel without me lifting a finger. All im really concerned with is saving as much money as possible so that i hold a greater than average position when I decide to buy.

Its bloody hard to break water.

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There must be tens of thousands like me that couldn't buy even if they wanted to pay stupid prices. A 3% payrise will make no difference to anything. If prices came down 20% I still couldn't buy anything. Renting is very expensive, and detrimental to saving, so I manage to put away just a little each month. The problem is people look at property prices and automatically assume renting is good value, so you can save stacks of cash whilst you are waiting. It ******ing isn't! but it's the only option for most.

A 50% crash is what it will take (Southern England) to get things back to normal again for most folks. And if it doesn't crash, it makes no difference to me, I can't buy now, I still won't be able to buy.

Grrrr.

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Guest

I think Chuz was referring to the opportunity cost of buying: What you can do with your deposit money while you wait, rather than renting itself being a major saving opportunity. It all depends on your personal circumstances and your expectations of the market movements in the near future.

As for further rises, well, the prices we currently have are the result of 3.75% interest rates, plus only meagre salary rises, with a drizzling of speculation to taste.

So, what would need to happen for prices to double in the next five years? Just for the sake of argument.

1. - Interest rates down to 1.75% while salaries stick.

2. - Salaries to double while interest rates stick.

Leaving aside present cost argument (often cited on this site), you see, if I buy a house, I rather need someone else to be able to buy it off me FAIRLY EASILY, and also have a fair degree of probability that someone will be able to do so at all!

( Discussion invited on the implications of my two scenarios. )

Edited by megaflop

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I got home last night and put C4 text on, the fall of 0.1% on the month was reported as something like 'House prices set to rise in 2006' plastered across the top as the main headline. Talk about putting a spin on things.

Edited by simon99

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They always have to put something positive in there- or a lot of us will be heading off tops of tall buildings!

Cant see prices surging in 2006 - however - 1 trillion of debt is not going to be repaid in 6 months somehow :lol:

Be interesting what kind of christmas we'd be having - be a good indicator whats to come in 2006.

Edited by trev

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Ref City News teletext page 502 (channel 4)

So my 3% payrise means i can spend another 3% on a mortgage? Oh wait im getting 3% because of inflation. F*ckin dimwits.

:lol:

"INFLATION" is an average. It depends WHAT you are buying precisely. You might have more or less buying powere depending on what it is, whatever the "headline" rate of inflation.

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Guest The_Oldie

Oh I think this Xmas will be plastered with retail doom and gloom from the commentators. Prices will be slashed in the shops and inflation will drop ... paving the way with interest rate drop in Feb or March 06.

By which time US rates will be approaching 4.5% and our rates will need to rise :rolleyes: .

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Read the 1989-95 crash news cuttings.

The problem with these forward-looking statements is that Dad gets on my case again.

Why can't these people just shut the f**k up?

I have the same... I have convinced dad by showing him the repayments.. then mapping them against higher interest rates.. (long term average..)

he still maintains that houses were unaffordable when his four bed house was 2.5 times his below average salary when he bought.. to the same property being 11 times my above average salary...

I love him to pieces but he can't process that this may be a tad more difficult for me to achieve.. when the mortgage would be more then I actually take home if it was a repayment... (well £30 of)

he just says that houses have always been expensive..

bless him..

so above average salary.. same house.. don't earn enough..

he does admit that prices will come down..

His opinion.. they always go up.. then they come down.. always happens.. he wonders why people don't see it..

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Actually Apom, I think it's more to do with "you can afford something at least, so go buy it - don't miss the boat".

IMO, the myth of house prices never falling comes from the 70s when rampant wage inflation mopped up the action.

I also got this: "Well, we never paid any attention to the housing market when we bought." Date of most recent purchase? May 1986.

I don't understand why my parents aren't concerned about what happened after 1989. I was 14, so wasn't paying much attention. By the time I was 16, and revising at home for GCSEs, I recall watching the TV and seeing these people getting their houses taken off them. Still, Neighbours was on in five minutes...

The anecdotes of the people on this website who got caught up in it, and indeed, their apparent determination never to get caught again - even to do STR - is understandable. Those who didn't get busted had to wait until 2002 to see their price come back up. Waiting until I'm 43 to get out of negative equity on a shitty little overpriced entry-level house is not an option.

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"INFLATION" is an average. It depends WHAT you are buying precisely. You might have more or less buying powere depending on what it is, whatever the "headline" rate of inflation.

Cant argue with that, so lets work on averages because i dont know what payrise (if any) you will get, i know im getting 2.8% but lets pick

5% payrise (generous as an average)

2.5% inflation (lower than what it currently is)

Wage (£30K very generous as an average)

Giving you an extra 2.5% 'buying power' which equates to an extra £750 pa Gross

30K x 4 mortage multiple = 120K (now we all know something fishy has gone on already)

+ 2.5% increase buying power ..

30750 *4 mortgage multiple = 123K

So potentially house prices can rise (using average inflation) by 3K

Lets not pay any inflation ..

Which is a mortgage of 126K so house prices (paying no inflation, with a 5% payrise) can rise by 6K

Of course realistically...

Payrise of 3%

Inflation 2.5% (you will be paying it, cost push is already happening)

Council tax increase ~+8% (not included in inflation)

Fuel / Power increase ~+5% (not included in inflation)

The part of the business cycle that we are in should leed us to recession, the busniess world knows it so you may not even get a inflation marked payrise (public sector workers exempt of course).

IMHO the reported inflation of 2.5% is misleading and false anyways.

We shall see what happens next year but im quite confident that we wont be looking at payrise tracking HPI

:)

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  • 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%



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