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eric pebble

Guardian: House Prices Fall In London’S Luxury Postcodes

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On the subject of the Guardian / GMG, does anyone know if they have a VI like most of the other newspapers to ramp up prices? I can't find it now but I'm sure I found that GMG own a property portal, albeit not a big one.

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Loved this bit from the article.

'However, the agency said the market was rising in other parts of London. Once the prime neighbourhoods were excluded, prices in the capital were up by 2% over the quarter and by 8.2% year-on-year.'

If the figures don't suit,just exclude the nice bits.

It's blown up.

'Kensington High Street in west London recorded the biggest fall between the first quarter of 2015 and the same period in 2016, dropping to an average of £1.8m. In nearby Notting Hill, average prices were down by 10%, at £1.5m. Other prime postcodes which have seen falls include Hampstead, where prices are down by 9.2% at just over £1m, and South Kensington where they have fallen by 5.8% to £1.9m.'

Edited by Sancho Panza

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GUARDIAN: House prices fall in London’s luxury postcodes

http://www.theguardian.com/money/2016/may/17/house-prices-drop-london-luxury-postcodes

Silly reasoning - silly bits still trying to talk things up -- but -- FALLS -- FALLS --- FALLS........

You do wonder how many banks are going to be checking out their margin call clauses on some BTL's?

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You do wonder how many banks are going to be checking out their margin call clauses on some BTL's?

The bank's will also be wondering where people will get the money to meet the margin. Then the gamble is will they get the money back.

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The bank's will also be wondering where people will get the money to meet the margin. Then the gamble is will they get the money back.

I don't think they will.I was with paddles et al in 2009.We were wrong on timing.

I think the West Brom action is a broader preamble to getting leveraged LL's to pony up some extra cash from either their own home or their own salary.Any of them that took on those liabilities without realising their own home or salary was underpinning the leverage shouldn't have been in the business in the first place.

As I posted in a thread about Yorkshire Bank 3 years ago,these moves have been afoot for some time.

http://www.housepricecrash.co.uk/forum/index.php?/topic/191749-nabaka-yorkshire-bankclydesdalepulling-the-plug-on-the-uk/

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In my personal opinion,all the ZIRP,HTB1+2,FLS etc has done is give the banks time to underpin some of the riskier parts of their mortgage book with claims on BTLer's other assets.

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On the subject of the Guardian / GMG, does anyone know if they have a VI like most of the other newspapers to ramp up prices? I can't find it now but I'm sure I found that GMG own a property portal, albeit not a big one.

...enough to make them VIs ...and like the BBC some of them will most likely be into BTLs ...... :rolleyes:

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I do think luxury purchases are probably cash only - so it doesn't really affect banks that much. The fall of a 1 bed flat in notting hill by 10% to less than £1.5m isn't exactly affecting most people who would bother to care about this website. I agree that where the luxury market goes the rest will follow but not at the same rate and certainly based on mortgage lending rather than infinite money laundering from China and Russia.

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I do think luxury purchases are probably cash only - so it doesn't really affect banks that much. The fall of a 1 bed flat in notting hill by 10% to less than £1.5m isn't exactly affecting most people who would bother to care about this website. I agree that where the luxury market goes the rest will follow but not at the same rate and certainly based on mortgage lending rather than infinite money laundering from China and Russia.

...it will affect Banks when property values fall and many of their customers go under the water line with their mortgages....the Chancellor didn't help with his 2016 BTL Boom pre stamp duty increase on 6th April ...and now the crash....is he really Chancellor material .....?....good reason not to support remain ..although most people have known for years the way they will vote....... :rolleyes:

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...it will affect Banks when property values fall and many of their customers go under the water line with their mortgages....the Chancellor didn't help with his 2016 BTL Boom pre stamp duty increase on 6th April ...and now the crash....is he really Chancellor material .....?....good reason not to support remain ..although most people have known for years the way they will vote....... :rolleyes:

And banks can make it back with fresh lending, in volume, for decades, on lower stable house prices. Main market consists of outright owners, highly equity rich, and BTLers imo.

'And now the crash'....? If so, you want to stop it with finding someone to blame. :lol: HPC HPC HPC.

A temporary surge of property-mad BTLers jumping into beat 3% stamp duty hike is NOT the Chancellor's fault. If it's taken them over to financial exhaustion, and set to cause a chain reaction, of BTLers crashing out, and CGT claims becoming due as they encounter S.24, and few FTBs in market willing to pay 'what it is worth'.

You were offering up the same excuses for end of MIRAS buyers. Ok you were on wrong side of it with 55% surge (pretty crazy)..... I can understand you seeing it that way, but others were not. They waited and got amazing value in the hpc. Including one London woman I know who traded up to lovely family home.

People have ownership of their own decisions - unless some of us want to become some hard Communist state to 'protect us from ourselves'.

Remember it all fell back (in many areas) afterwards. A repeat would be most welcome, especially with ever more BTLers and owner outrights carrying the market. No one dragged the buyers into it at ever higher prices in a frenzy. And this time it's been race by BTLers and multiple property owners / second homes / 3rd homes. HPC.

...agreed remember it well .....announced in March and delayed until 31st August 1988.....we exchanged contracts to purchase new build in March, rented until July after selling our own and in the three months the value increased 55%.....bad spike created by the Chancellor..... dry.gifdry.gifdry.gif

I bought 1982 for £30,000

Sold 1988 for £160,000 with OPP for Nursing Home

My buyer sold 1989 for £90,000 - he'd overstretched his finances.

You should believe it because it is true. The Chancellor signalled in the budget that dual MIRAS relief was to be abolished on (if memory serves) July 31st 1988. In the months running up to the abolition there was a feeding frenzy in the property market as FTBs borrowed as much as they could to get on the ladder. Prices (already rising fast) went ballistic.

On August 1st the market just stopped. In the last week of July 88 I put my house on the market advised by agents that there would be a stampede. There was during the first week. Then it stopped. I sold 18 months later for 40% below the asking price.

It's different this time because it's the BTLers. HPC.

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In my personal opinion,all the ZIRP,HTB1+2,FLS etc has done is give the banks time to underpin some of the riskier parts of their mortgage book with claims on BTLer's other assets.

Agreed... absolutely and I know others here will be leading the breakdown for even more greed than in Bubble 1.0.

The hunt for blameless victims (lol - geez) on the house/BTL side... who had it all... so much. It's been made borrowing and malinvestment on specuvestor side. Obviously many VI are only interested in maintaining values of their own house mad-gainz, thus the quest for innocence, and expecting younger generations to carry ever more of it.

From that Grand Designs episode. 2008.

Not only have things on site change but there's been a huge shift in the world economy. Barry's plan has always been to finance this project by selling their current home and the development project he owns next door.

Barry: £450,000 is what they've asked us to drop it by. Now that house (points to Peter Andre rented development house to the right of the glass mansion house), and that house (points to his original home) are worth kind of the same money. If I was to drop them both by that kind of money then it's going to cost about one million pounds. The dream that I've had has been entirely changed since we've started building it.

Barry: I've had a few days in each of the last few weeks where I've been really demoralised by it. Now I'm thoroughly aware I've put us in a position that we really didn't actually have to be in. There's a different scenario attached to our personal finances now so us like everyone else have got concerns. Suddenly it seems excessive to have even the vehicles we've got, and three houses in a row, that kind of stuff. There's almost an element of embarrassment about it.

Wife: I've thought so much, were we too greedy, were we striving for too much when what we'd already got was more than, you know, a lot of people would hope for in a lifetime really.

Have a listen to the Radio 4 Moneybox Buy to Let episode from last Saturday: http://www.bbc.co.uk...rammes/b0631nq3 TBH I'm surprised I haven't seen anything on the forum about it

This will give you an idea of who is paying these ridiculous prices. E.g. late middle aged couple paid £490,000 for a one bedroom flat, with stamp duty and furnishings that must be at least £510,000 outlay. They receive £1300 pcm rent, net after service charge etc. That's 3% yield gross! they seem to be happy about probably losing money month to month on the rent because they are in it for the long haul and the massive capital appreciation that will undoubtedly materialise over the next couple of decades. After all, the lady being interviewed bought her own flat in the area for £107,000 which is now worth £650,000!

There will be no price correction until these types of people have been well and truly scared away from BTL

£490,000 1 bed flat. £1,700pm ... after service charge we get around £1,300pm, which covers the mortgage at the moment. Fixed rate mortgage that goes up in 2 years.

Bought her own flat decades ago.

And I've lived in his area for 25/26 years. When I bought my flat it was £107,000. It went down to £82,000 and the mortgage rate went from 7% to 15%. Now my flat is worth about £650,000 and I feel reasonably confident it's a good investment.

Husband went "Oh" - with a disappointed groan when heard about the Budget, but it's swing and roundabouts and long term investment.

--------------------

^ Remember this when hpcers try to instigate Breakdown 2.0 excuses (like 2008-2011) if and when prices begin to soften. Noticed it last week with a HPCer claiming "It's not buyers fault for paying £500,000 because they can't see it in real money.. if they saw it stacked up in notes they would know."

I think buy-to-let (meaning lenders and borrowers both) is coming into the limelight simply because it's one of the most significant remaining problems. BTLers are the largest segment of speculators still acting in the market. Much of the previous speculation by owner occupiers - in the form of liar loans, interest-only lending, and 100%+ LTVs - has already been knocked on the head.

Help to Buy is an issue but the volumes are so low that I don't think it can hold up prices without speculators taking up a significant portion of the market. It's mainly a sentiment driver and speculators are likely the strongest reactors to sentiment drivers, hence without the speculators it has substantially less teeth to drive prices. MMR has limited loans to income for owner occupiers and Carney has indicated he expects to see an increased spread between base rates and market rates due to lenders meeting the increased costs of higher regulatory and capital requirements, so low base rates should also be less of an issue. This is especially true if the amount of speculators in the market is reduced, as this would seriously curtail the other consequence of low base rates on the housing market: yield chasing. Supply of actual physical homes is arguably meeting direct demand but falling short of speculative demand, and thus reducing speculative demand would also help with this issue.

Equally there are BTL landlords who have and will get out with massive unearned gains, just as there are other speculators of all stripes who stand to lose it all and more in a BTL-induced correction. The world is not just. While it's good to try and work out the truth of what's happened what's most important is that the situation gets solved and people who are not to blame at all stop having to suffer the consequences of the actions of those who do share in the blame and are currently living the life of Riley.

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http://www.dailymail.co.uk/property/article-3592685/House-prices-London-continue-rise-dropped-12-expensive-parts.html

The Wail chimes in.

'What slowdown? House prices in most of London continue to soar - but drop by 12% in the most expensive areas as tax rises start to bite.'

Edited by Sancho Panza

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Found it... http://www.theguardian.com/gnm-press-office/acquisition-of-core-estated-limited

GMG owns Vebra and thinkproperty. Vested Interests ramping up property prices, and tax avoiders to boot...

Edit: looks like they just sold some of it to Zoopla/DMGT... http://www.ldc.co.uk/news/2016/04/ldc-agrees-sale-of-property-software-group-to-zoopla-plc Hmm, more digging needed.

Edited by spunko2010

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