How far do peeps think PCL will fall

[Guest]

1 hour ago, TheCountOfNowhere said:

Pcl Down 12% from 2014 peak...just saying like.

Youd think that would be all over the media ... if food/fuel is cheaper they love it. Strange isnt it!

[Si1]

3 hours ago, Foreverblowingbubbles said:

. It still won't be priced keenly - that would take 75% falls - but I just don't see it getting to that point without a genuine worldwide depression

The Father Ted defence.

[Si1]

PCNY and PCTKO both lost 90% + following 1929 and 1989 respectively. That's my benchmark.

 

1929 was a global depression, allegedly, although there were plenty of places it didn't touch. 1989 was a big regional recession, the SE Asian financial crisis.

Edited January 13, 2017 by Si1

[Peter Hun]

4 hours ago, TheCountOfNowhere said:

I've just come down from the tiny violin shop, they've run out, soz.

I don't think they need your sympathy, these guys made massive money before going bust.

[Si1]

2 minutes ago, Peter Hun said:

I don't think they need your sympathy, these guys made massive money before going bust.

Going bust with whose money?

[spyguy]

2 minutes ago, Si1 said:

Going bust with whose money?

Yours + your kids, sadly.

[TheCountOfNowhere]

3 hours ago, Kiwi_Muncher said:

Youd think that would be all over the media ... if food/fuel is cheaper they love it. Strange isnt it!

Very odd.  It's like the MSM want prices to stay high.

[TheCountOfNowhere]

25 minutes ago, Peter Hun said:

I don't think they need your sympathy, these guys made massive money before going bust.

Should be forced to hand over every penny to their creditors, or hung if they fail to.

[Si1]

22 minutes ago, spyguy said:

Yours + your kids, sadly.

Mmmmmmmm. Anything to do with one Mark Carney?

[spyguy]

1 hour ago, Si1 said:

Mmmmmmmm. Anything to do with one Mark Carney?

Again, sadly his are fcking off back to Canada

[Patient London FTB]

18 hours ago, Chrippie said:

Hyde Park is 350 acres, = c. 15m sq feet. Normal density of London is around 1/5 (my assumption), ie 1/5 of land is actually built on for residential property, leaving the rest for streets, gardens, playgrounds, schools, hospitals, shops, offices, car parks etc., ie if they built over Hyde Park there's around 3m sq feet they could actually build residential on allowing for all those other amenities that are needed. There's 36000 properties in PCL coming. Assume average size is c. 1,000 sq feet and you get Hyde Park to 12 stories. Even if its 10 stories If you look at a map of London and think about how big Hyde Park is and the fact that most of PCL is to roughly 3 or 4 stories and its a good way of thinking about the ridiculous scale of the overbuilding that is going on here.

Thanks for the explanation, pretty convincing. And I didn't have time yesterday to go over your first post, but it was great insight. 

I think over the next three years PCL as a whole will be down over 50% in US dollar terms but new builds will be more like 75% down. 

Since the peak in early 2014 it's down 12% in sterling but 35% in USD so it's well on the way. Given your Singapore story I can't wait to see data about how badly overseas banks are exposed to that valuation crash already. 

It's worth observing the downward direction in rents in PCL will be further hurting overseas investors. Knight Frank's Dec 2016 data has rents down 5.1% yoy in PCL, and as bad as 10.1% down in Knightsbridge. All those new builds coming on stream and the hiring decline in financial services are only going to weaken rents this year. 

Edited January 13, 2017 by Patient London FTB

[spyguy]

PCL is really only the very posh bits - Knightsbridge, Mayfair.

The rest of London is, frankly, pretty sh1t.

You get the odd nice leafy bit in up by Kew.

But then theres the distinctly non-prime like Peckham and, basically, everywhere else.

How far will these fal- to 4 time local wages.

[rantnrave]

35 minutes ago, spyguy said:

How far will these fal- to 4 time local wages.

Single or joint?

[Chrippie]

1 hour ago, Patient London FTB said:

Thanks for the explanation, pretty convincing. And I didn't have time yesterday to go over your first post, but it was great insight. 

I think over the next three years PCL as a whole will be down over 50% in US dollar terms but new builds will be more like 75% down. 

Since the peak in early 2014 it's down 12% in sterling but 35% in USD so it's well on the way. Given your Singapore story I can't wait to see data about how badly overseas banks are exposed to that valuation crash already. 

It's worth observing the downward direction in rents in PCL will be further hurting overseas investors. Knight Frank's Dec 2016 data has rents down 5.1% yoy in PCL, and as bad as 10.1% down in Knightsbridge. All those new builds coming on stream and the hiring decline in financial services are only going to weaken rents this year. 

You're right re rents we renegotiated our rent down by c. 10% when we re-signed in July this year. That was having looked at a number of properties. We put a bid in to rent a house in W8 at 25% below the asking and it was I think nearly accepted. That was in July (last tenants moved out in March roughly as I recall) and that place is still on the market now. I think the 12% decline doesn't fully reflect how bad it really is.

[spyguy]

16 minutes ago, rantnrave said:

Single or joint?

Single.

Double does not last - kids.

After kids - too old.

[Foreverblowingbubbles]

7 hours ago, Si1 said:

The Father Ted defence.

Sorry si, I've missed your reference? 

[janch]

Chrippie....I don't think you sold too early since it took so long (12 mths) to sell.  Once prices start to fall more noticeably there won't be (m)any buyers and people who want to sell will start to panic.  Better to sell at a point when prices are still rising and very near the top than on the way down.  I would say it was good timingVery interesting post by the way.

[Noallegiance]

Too early is better than too late.

We STR'd in late 2014. No chain and still took 5 months.

Small equity pocketed. Could have held on until now for mega gains but, like a satisfied Deal or No Deal player, we aren't greedy and are happy with our lot.

We're risk averse so the stress of trying to time an exit all the while hanging onto jobs we hated in an area going downhill fast wasn't worth it. In 2014 I no longer wanted a mortgage. I believe that even more strongly now.

What goes up......

[“Nasty Piece of work”]

Quote

41 minutes ago, janch said:

I don't think you sold too early since it took so long (12 mths) to sell. 

Agree - you cannot get a more illiquid asset than housing.  That is why it will be soooo good.....

 

[NeedSpace]

7 hours ago, Si1 said:

Going bust with whose money?

Its the hedge fund management company, usually a limited liability partnership that goes 'bust', not the hedge fund itself.  The hedge fund is usually an offshore entity controlled by the management LLP.  If the fund suffers enough redeptions (due to poor performance), the LLP is no longer viable - and goes bust.  The investors themselves dont suffer from this, apart from the poor returns.

[Si1]

2 hours ago, Foreverblowingbubbles said:

Sorry si, I've missed your reference? 

It's the sort of over general unsupported mor illogic that father Jack Crilley came out with all the time, that's all

[Si1]

57 minutes ago, NeedSpace said:

Its the hedge fund management company, usually a limited liability partnership that goes 'bust', not the hedge fund itself.  The hedge fund is usually an offshore entity controlled by the management LLP.  If the fund suffers enough redeptions (due to poor performance), the LLP is no longer viable - and goes bust.  The investors themselves dont suffer from this, apart from the poor returns.

Really interesting, thanks

[Peter Hun]

7 hours ago, TheCountOfNowhere said:

Should be forced to hand over every penny to their creditors, or hung if they fail to.

Investers understand the fee structure and the fund rules when they invest. If the fund falls 8% they get the balance back and the fund shuts down. If the share price of the fund increases over and above their entry price, the investors pay 20% of the profit (in theory).

[CunningPlan]

9 minutes ago, hotairmail said:

It's the same with construction. Every site comes under its own limited liability structure so that it cannot bring down the centre.

Personally, I think (like charity structures) limited liability is a scourge and the opposite of my word is my bond.

Correct. See here - https://beta.companieshouse.gov.uk/officers/BPy51Q4daO4UBfLmkYMUyElo0qQ/appointments

[Chrippie]

3 hours ago, fru-gal said:

There is no way the Government will let house prices fall much. They will bring in new props to keep prices high imo or reverse the stamp duty changes.

Not sure I agree with this - used to be true in my view, but the politics have changed. Home owners vote tory, renters vote labour. A significant number of owners of PCL don't even have a vote as they're foreign. Create a generation that can never own a home and you're creating a generation of natural Labour voters. Not good politics for a Tory government to do that, and I think they've finally woken up to it; I think they want prices to fall now. Plus even boomers I speak to are more relaxed about house prices falling as they know its the only way their kids and grandkids are ever going to get a house. I have 4 kids and live in London. For them to have a similar lifestyle to mine they between them are going to need to come up with millions and millions to put into property. Not going to happen. Even if I owned a home therefore I'd want prices to come down (unless I was overleveraged etc).

The politics of cutting stamp duty at the top would be terrible at the moment. So I suspect therefore that if they do do away with it it will be replaced by something else so it can't be spun as a tax cut for millionaires.