aussieboy Posted January 10, 2006 Share Posted January 10, 2006 Interesting. Looking at the Nationwide figures in the handy thread provided by a fellow HPCer, I notice a 5% fall in the area I am looking to buy which leads me to think "That's not much, barely material, I'll hold on". However, I am considering moving some assets from Australia to the UK (given the exchange rate... 2.5 is parity from a Big Mac Index PoV) but when I see that prices in Sydney have also fallen by 5% I think "That's an awful lot: perhaps I'll keep hold and keep renting out". Perhaps this buyer - seller utility curve is a factor that is contributing the current stasis in the market which may only change when structural pressures build up sufficiently to force the hand of either buyers or the sellers... and it's unlikely that the buyers will blink first. Quote Link to comment Share on other sites More sharing options...
Goat Posted January 10, 2006 Share Posted January 10, 2006 With average prices now £180,000 even a 1% fall is fairly significant. Anything above 10% is a crash, being enough to wipe out the equity of a large number of owners. Quote Link to comment Share on other sites More sharing options...
Jason Posted January 10, 2006 Share Posted January 10, 2006 "How Big A Fall Is A Significant Fall?" Well imagine this: You love cake, I mean can't get enough of it (this represents the majority of british homeowners who love to talk about how much their house is worth). I come along and take a bite out of your cake. At what point do you go skits???? Quote Link to comment Share on other sites More sharing options...
Goat Posted January 10, 2006 Share Posted January 10, 2006 At the moment you even look at my cake Quote Link to comment Share on other sites More sharing options...
Fancypants Posted January 10, 2006 Share Posted January 10, 2006 Perhaps this buyer - seller utility curve is a factor that is contributing the current stasis in the market which may only change when structural pressures build up sufficiently to force the hand of either buyers or the sellers... and it's unlikely that the buyers will blink first. perhaps you're right. And don't forget that the supply of buyers has been more or less exhausted. Like the whole debt-funded farrago, the market has already consumed 2006/2007's FTBs and many other buyers - simply bringing them forward to fuel the fast-burning boom of the past few years. It would take more than a 5% discount to stimulate new buyers in any significant numbers. Quote Link to comment Share on other sites More sharing options...
Shamus Posted January 10, 2006 Share Posted January 10, 2006 (edited) I live in the South of England in Dorset and what I am seeing is properties sticking around for ages and ages not selling or being reduced further. How long can and will this continue? The average house price is above many parts of the country and affordability is very stretched given that FTBer wages and normal wages are not that great. If these houses are in a chain then I can see it taking a long time for a price adjustment downwards as nobody appears to be budging on price. Therefore if a seller cannot get a mark down on the property they are after why should they budge on theirs? A significant fall would be 30% in a semi low interest rate environment this would wipe out 50% gains but I think it will be closer to a 20% fall personally. Edit: PS The homes sticking are the undesirable ones - I guess the decent ones don't hang around on Rightmove long enough for me to notice!! Edited January 10, 2006 by Shamus Quote Link to comment Share on other sites More sharing options...
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