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Wurzel Of Highbridge

I Am Calling The Top.

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Right I am calling the top on this lunacy! Today marks the top of the London housing bubble, stocks and GBP.

It's either the top, the bottom, or somewhere in between. I''m pretty sure of that. :lol:

I personally think now that the MEGGA/SUPER BUBBLE word is going main stream, interest rate rises are being touted, war is in the offing, the co-op bank is going down the pan, asking prices are just plain silly and my anger levels...you could well be right.

Edited by TheCountOfNowhere

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Prices will continue to rise in London for some time yet simply due to lack of supply. First house in ages in our area has gone up for sale, and I suspect will be under offer on Tuesday after the open day this weekend. Market sentiment, although irrational, is such that the buyers that are there are stretching themselves as they cannot afford to hold off on their purchase. It is also catchment area season where many parents realise that they have to move to get into a school.

Until people get kicked out of their homes, prices won't fall. I can't even see stability in the next six months.

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Prices will continue to rise in London for some time yet simply due to lack of supply. First house in ages in our area has gone up for sale, and I suspect will be under offer on Tuesday after the open day this weekend. Market sentiment, although irrational, is such that the buyers that are there are stretching themselves as they cannot afford to hold off on their purchase. It is also catchment area season where many parents realise that they have to move to get into a school.

Until people get kicked out of their homes, prices won't fall. I can't even see stability in the next six months.

One could link this thread with the one about the unhappy couple staying together. Why is supply constrained? I would suggest the main driver is that the only people who can afford to move are those downsizing (either via location or size) or moving sideways (ditto). No ordinary family can afford to 'climb the ladder' at current prices.

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Prices will continue to rise in London for some time yet simply due to lack of supply.

laugh.giflaugh.giflaugh.gif

There was the same supply in 2007.

It's the dodgy money printing, media propaganda, sub-prime givernment bank lending, HTB, FLS, that fueled the london mega bubble.

IIt's supply and demand and access to finance and willingness to take risk.

Demand will disappear quickly, credit could stop tomorrow and willingness to take risk when something is so obviously going to collapse must be at an all time low.

Caveat Emptor.

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Prices will continue to rise in London for some time yet simply due to lack of supply. First house in ages in our area has gone up for sale, and I suspect will be under offer on Tuesday after the open day this weekend. Market sentiment, although irrational, is such that the buyers that are there are stretching themselves as they cannot afford to hold off on their purchase. It is also catchment area season where many parents realise that they have to move to get into a school.

Until people get kicked out of their homes, prices won't fall. I can't even see stability in the next six months.

just how do stretched buyers stretch themselves just that 10% more?

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The post was inspired by the lack of posts on this site recently, this is a contrarian post. ;)

MMR kicks in this month so it's going to cause delays and sales to fall through. Add that to the panic buyers are already undergoing, the panic will flip to fear.

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The post was inspired by the lack of posts on this site recently, this is a contrarian post. ;)

MMR kicks in this month so it's going to cause delays and sales to fall through. Add that to the panic buyers are already undergoing, the panic will flip to fear.

I had noticed that. The frequency of you, Count and sheeple was starting to get on my t1ts.

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just how do stretched buyers stretch themselves just that 10% more?

200k + 10%+10%+10%+10% = £292.82k :blink:

It's a mathematical certainty that things are going to hit a wall and stop. 20% yoy gains in London are unsustainable unless you have an exponentially shrinking supply to offset the exponential number of buyers priced out.

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200k + 10%+10%+10%+10% = £292.82k :blink:

It's a mathematical certainty that things are going to hit a wall and stop. 20% yoy gains in London are unsustainable unless you have an exponentially shrinking supply to offset the exponential number of buyers priced out.

Even then, you still need credit and a load of buyers happy to take on increasingly ridiculous amounts of debt.

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I had noticed that. The frequency of you, Count and sheeple was starting to get on my t1ts.

Dunno what you mean, i've cut back my posting recently as I am sooooo busy trying to buy a flat in London before I miss out.

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200k + 10%+10%+10%+10% = £292.82k :blink:

It's a mathematical certainty that things are going to hit a wall and stop. 20% yoy gains in London are unsustainable unless you have an exponentially shrinking supply to offset the exponential number of buyers priced out.

Average salary: 30k + 0% + 0% + 0% + 0% + 0% = 30k.

See any problem there ?

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200k + 10%+10%+10%+10% = £292.82k :blink:

It's a mathematical certainty that things are going to hit a wall and stop. 20% yoy gains in London are unsustainable unless you have an exponentially shrinking supply to offset the exponential number of buyers priced out.

sure, exponents work to fail, but, just how do people manage to stretch that extra 10% every year, assuming they were stretched at the 200K starting block?

I think Eric knows the answer....certainly, in 2003, lowering monthly repayments was one way of doing it....and even that hits a wall...which it did in 2008...

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Even then, you still need credit and a load of buyers happy to take on increasingly ridiculous amounts of debt.

It like the comparision to posh cars everyone would like one but not everyone can afford one. The only difference is the banks and goverment have got there heads together and though of a way of letting people borrow as much as they can. It used to be the amount of savings you have dictated how much above and beyond the sensible price for a house you are willing to pay, now deposits are almost meaningless and its just all about how much debt you are willing to load on yourself. Complete madness and playing to the banks. What tells me we are getting near the top is parents of younger buyers starting to complain about their children not being able to buy. I hear it everwhere now, I think people who own a house are now starting to feel the burden of a society with high house prices as they begin to be forced to renter the game helping their ofspring get somewhere to live.

Try going into a bank ten to twelve years ago and asking for a mortgage similer to one you would need to buy the same house right now they would laugh you right out the front door. I think the only way we are going to really so a correction is if the intrest rates raise. I just can't see will power alone be enough to quell prices.

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I just can't see will power alone be enough to quell prices.

Well, quite - especially as this will-power would have to extend to all possible market participants. No good one sensible potential buyer dropping out of the market if there are 10 more happy to take his/her place.

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There was the same supply in 2007.

There was far more supply in 2007. Volumes these days are far lower. The thing that will cause prices to flatten (and fall) in increased supply. There are two ways of achieving that. Either kick people out for not paying mortgage or build more homes. 2007 was a small blip and house prices recovered thanks to low interest rates which meant those who felt secure in their employment (or have cash in the case of foreign buyers/BTL) have been buying ever since.

I believe that when the market falls it will more like 1991-1998 when repossessions flooded the market and sellers had to reduce prices to compete. For that to happen it will mean job losses or a significant rise in interest rates. I'm not even sure if job losses will have the impact experienced back then due to BTL.

All I am writing is that this market hasn't topped out yet.

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snp

Try going into a bank ten to twelve years ago and asking for a mortgage similer to one you would need to buy the same house right now they would laugh you right out the front door. I think the only way we are going to really so a correction is if the intrest rates raise. I just can't see will power alone be enough to quell prices.

you are right, going to a bank 10 years ago wold have got you nowhere, thats where the financial intermediaries came in...guaranteed no checks deals from 2001 for the commission earners...bankers could maintain the facade that they were lending 3 x salary, while offering a wall of money to the intermediaries.

I suspect very much the exact same thing is happening today?

I mean, how can an intermediary even say...Ill sort something out for you, leave it to me...2+2 WILL equal 7 by the time he has finished.

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There was far more supply in 2007. Volumes these days are far lower. The thing that will cause prices to flatten (and fall) in increased supply.

Link to your facts please ?

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I'm not even sure if job losses will have the impact experienced back then due to BTL.

Very good point that was missed on this site.

One thing we currently have is rents that are falling in real terms. That should reduce the demand from the BTL/blue rinse brigade, but the media are very reluctant to report on falling rents.

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