Proptastic to Droptastic

[Fairyland]

Media is full of bearish news these days. It is surprising to see how everything had made a U turn and we see at least one bearish article almost every day. Up until last year we saw a boom in making. Are we now experiencing the opposite? How much do you think prices will fall and for how long?

[Thorn]

1 hour ago, Fairyland said:

Media is full of bearish news these days. It is surprising to see how everything had made a U turn and we see at least one bearish article almost every day. Up until last year we saw a boom in making. Are we now experiencing the opposite? How much do you think prices will fall and for how long?

Sink for 2 years to bottom and London down 70%, SE England down about 60%, Manchester a bit less, smaller towns and everywhere else 30%.

just guessing. That was the timeframe in nIreland to the bottom- some say the low was 2012 in fact- and there were so many terrible stories behind those falls. 

Edited January 20, 2018 by Thorn

[Liquid Goldfish]

2 hours ago, Thorn said:

Sink for 2 years to bottom and London down 70%, SE England down about 60%, Manchester a bit less, smaller towns and everywhere else 30%.

just guessing. That was the timeframe in nIreland to the bottom- some say the low was 2012 in fact- and there were so many terrible stories behind those falls. 

My prediction is very similar. Two years to the bottom once is starts. Everywhere down to 50% of 2007/2008 highs. So London down 75%, SE down 65%, areas I know like South Manchester and North Leeds, Harrogate, York, West Sheffield down 60%, but towns where they have stayed down since 2007/2008 will only fall another 30%.

Edited January 20, 2018 by oldsport

[Drummer]

London house prices to fall 70% over the next 2 years? I admire your optimism. I would settle for 15% off in a town that has largely remain unchanged since 2008!

[adarmo]

Dream world lol!

At the height of the greatest recession in 80 years prices fell 20%YoY. Somehow a bit of bad news in the MSM is going to precipitate a crash greater than any in UK history?

Short of a war, alien invasion or some crazy disaster/pandemic they aren't going to crater 70% (it's not BitCoin FFS!). 

There's no forced sellers. Why would people not stay put or just let it out if they had to move rather than taking a 70% hit. The lower a market price the less incentive someone has to sell. 

[Thorn]

3 hours ago, Drummer said:

London house prices to fall 70% over the next 2 years? I admire your optimism. I would settle for 15% off in a town that has largely remain unchanged since 2008!

QE, 3000-Year historically low interest rates plus overseas investors aiming to park wealth.

all seem to be coming to a close.

that leaves government props like HelpToBuy which I reckon should be renamed HelpToBuy-Please.

Do you see lots of reasons out there to support prices- that’s the real question. 

Ps when they dropped in nIreland it was astonishing as cheap money lending just stopped overnight and the banks called in a lot of loans and mortgages, closing businesses and it was brutal.

And the fallout is still everywhere around.

Throughout that time trips to London showed life seemed to continue as normal. That’s how I found this site- trying to understand WTF. 

WTF was QE, low interest rates and foreign investors mainly I think.

[Thorn]

And it only takes one desperate seller in a street to accept a lower price first, that sets the new price for the street.

A “marginal seller”- it’s these marginal sellers that set the latest prices everywhere.

[Barnsey]

Now we have Fulham prices down 14% since peak, Southwark down 21% in the last year alone along with other big yearly falls in central London, and the falls are now spreading, ripple effect. Inevitably as the inner bits get cheaper, the outer bits look like very poor value.

Don't forget the BTL sell off now underway too.

As a pessimist, we have to remember that RPI is about 30% accumulative since the last crash so perhaps worth factoring this in to some extent with the carnage to come.

Edit: Just went down to the shops at the tube station (SW London zone 3) and noticed 2 of the estate agents that opened 3 years ago or so have closed, now empty units. Another sign of things rippling outwards.

Edited January 20, 2018 by Barnsey

[billy budd]

Just stumbled on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

Edited January 20, 2018 by billy budd
Typo

[Fence]

9 minutes ago, billy budd said:

Just stumbles on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

"I am also concerned that if you kill off the foreign investor market, you kill off London’s Zone 1 market, then the suburbs, then the home counties and beyond.”

...now over to the Ripple thread....!

[Maynardgravy]

1 hour ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/“My office has hundreds of files where investors have lost money.

“The problem has been massively under-reported, because the Land Registry does not record prices at exchange, only at completion.”

Yum!

[dougless]

2 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

Thanks Billy, a really interesting read.  The News seems to be getting better and better.

[thewig]

Anyone who bought in London the past five years to make money is getting eviscerated. Then the past ten years. Then the rest.

only one person sells the top of a bubbble

see also: crypto 

[mathschoc]

1 hour ago, Maynardgravy said:

“The problem has been massively under-reported, because the Land Registry does not record prices at exchange, only at completion.”

Yum!

Going to plaster it all over my social media , ho ho ho

[Democorruptcy]

2 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

It implies 25% drops:

Quote

 

For example, they might have put down £200,000 on a £1m off-plan flat expecting it to be worth £1.2m or £1.3m within two or three years.

Instead, said Herd, they are finding its value has dropped to between £750,000 and £800,000

 

Obviously over London's £600k Help to Buy Bail Banks and Profit Builders but it makes you wonder if those sort of drops are happening with that scheme. Each £600k house and 25% drop is FTB down £30k and taxpayers down the £240k they hand to the bank. The governbankment say the NHS etc is struggling dontcha know... 

[Shrink Proof]

3 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

This makes great reading:-

Steven Herd, founder and CEO of MyLondonHome, an agent which is one of the biggest players in the new homes and investment market, said that every day, his firm is having to try to help a foreign investor exit a deal with the least pain.

He said he does not know a single instance where a foreign investor who has bought in the last two years has done anything but made a loss on an off-plan purchase.

In some instances, losses have been as low as 5%-10%, but in others, investors have taken a far greater hit.

In an exclusive interview with EYE, Herd said: “At times, my firm feels as though we have become debt advisers, and not estate agents.

My office has hundreds of files where investors have lost money."

[ftb_fml]

3 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

 

3 hours ago, Fence said:

"I am also concerned that if you kill off the foreign investor market, you kill off London’s Zone 1 market, then the suburbs, then the home counties and beyond.”

...now over to the Ripple thread....!

 

7 minutes ago, Shrink Proof said:

This makes great reading:-

Steven Herd, founder and CEO of MyLondonHome, an agent which is one of the biggest players in the new homes and investment market, said that every day, his firm is having to try to help a foreign investor exit a deal with the least pain.

He said he does not know a single instance where a foreign investor who has bought in the last two years has done anything but made a loss on an off-plan purchase.

In some instances, losses have been as low as 5%-10%, but in others, investors have taken a far greater hit.

In an exclusive interview with EYE, Herd said: “At times, my firm feels as though we have become debt advisers, and not estate agents.

My office has hundreds of files where investors have lost money."

Wonderful - it's fantastic to see industry admission of the inevitable burst bubble and corresponding price reversal really gaining momentum.. the numbers being banded about are damning and wholly unambiguous in their meaning. This certainly doesn't look like another brexit-blamed-"blip".

I have zero sympathy for these opportunistic parasites - Iong may prices continue to plummet 

[LetsBuild]

4 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

Wow that’s the juiciest bear news I ever read!

‘Absolutely nothing to do with Brexit’ being the cherry on top for me.

[Fence]

1 hour ago, Democorruptcy said:

Bail Banks

No longer bail!  Pure graft surely?

[Alistair Campbell]

4 hours ago, billy budd said:

Just stumbled

 on this piece in "Property Eye" - time for the tiny violins..

http://www.propertyindustryeye.com/foreign-investors-left-nursing-huge-losses-as-they-scrabble-to-get-out-of-off-plan-deals/

makes very good reading.  Bring it on!

[Fence]

15 minutes ago, Alistair Campbell said:

makes very good reading.  Bring it on!

Credit to the publisher and Steven Herd for saying it as it is.

[Fromage Frais]

"Herd said that buyers of distressed property bought off-plan tend to be domestic owner-occupiers."

And that there is the reason for HTB London folks :-)

[Si1]

2 hours ago, Fromage Frais said:

"Herd said that buyers of distressed property bought off-plan tend to be domestic owner-occupiers."

And that there is the reason for HTB London folks :-)

I'm not sure I'm with you? (Genuinely)

[warrior88]

On 19/01/2018 at 11:05 PM, Fairyland said:

Media is full of bearish news these days. It is surprising to see how everything had made a U turn and we see at least one bearish article almost every day. Up until last year we saw a boom in making. Are we now experiencing the opposite? How much do you think prices will fall and for how long?

Because of help-to-buy and only because of help-to-buy limited 5% fall in London and south-east over 2 years otherwise I would expect 20% drop.

Static prices elsewhere in UK.

Ofcourse, all this could change if there is another global crash (quite unlikely in the next 2 years).

[Freki]

6 hours ago, warrior88 said:

Because of help-to-buy and only because of help-to-buy limited 5% fall in London and south-east over 2 years otherwise I would expect 20% drop.

Static prices elsewhere in UK.

Ofcourse, all this could change if there is another global crash (quite unlikely in the next 2 years).

How is help to buy flooring London prices? It's for new build and 600k. Every 3 beds are above a mill for new builds.