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2rocketman

I think the wait is over

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I have been waiting 6 years to buy, come close a couple of times out of desperation,  pressure from others around me etc same as many on here. I follow West London and parts of the south. I know variety of people from all different backgrounds, amongst them, an estate agent, couple of developers, first time buyers, landlords, affluent individuals, help to buy owners, business owners, sellers, professionals of all types etc. I really think from everything I see, read and hear this next 12 months is going to be brutal. Many are talking negative now,  no longer the uber upbeat tone of a couple of years ago.  I have said on here for a while  the crash started long ago and I personally think it is now clear it did (London & south only, I know nothing about the market in the north of the country). Sentiment has been turning, prices dropping, properties not selling/renting etc but it has been gradual. I’m calling it now, this time next year I think the market will be decimated. I know of someone selling land to a developer, a big deal, they have backed out on him. I know someone who was flipping a house, been holding it 2 years from purchase now and just coming to terms with the fact they are going to loose 100k plus and that’s after doing a complete renovation and a loft conversion. I know someone else, tight as two coats of paint, just took a 200k drop to get a sale through on one of his properties, very out of character,  but he is a right time right place kinda guy and I’ve no doubt that will look shrewd in time (he still made a killing).  I could go on and on but the point is the tide has turned and it’s now common knowledge. Those who kept saying buy buy buy have fallen silent. We are now in reverse and I think it is going to pick up speed. Redundancies are becoming more common, closures happing all over the place, Brexit, S24 all ready to add to the doom.

I was speaking with the estate agent I know the other day and he said it’s not only buyers on the sidelines, he has plenty of potential sellers too. Many of whom get valuations done only to inform him after they won’t be marketing the property until post Brexit. I think once it is done whatever the outcome a lot more properties will come on and hopefully sellers will out number buyers and it will trigger the collapse. I am sure someone will repost this if I am wrong, I even will if I remember but I can feel it, this is different! The next 12 months is going to be a bit tasty. 

I won’t be taking out any more fixed isa’s etc I want my funds accessible now.

2R

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Agree with everything you said.  I too am waiting with my deposit.

The only question is what outrageous stunt the government will pull to try to keep the bubble inflated.  I wouldn't put anything past them, to include just straight up giving people money to make up losses/negative equity.

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1 minute ago, Discustard said:

Agree with everything you said.  I too am waiting with my deposit.

The only question is what outrageous stunt the government will pull to try to keep the bubble inflated.  I wouldn't put anything past them, to include just straight up giving people money to make up losses/negative equity.

Even if they do, I have faith that eventually, some day, that desperate bubble will burst, and the more it's inflated, the more brutal the burst. It should be allowed to collapse and burn now so something anew can grow. 

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3 minutes ago, Discustard said:

Agree with everything you said.  I too am waiting with my deposit.

The only question is what outrageous stunt the government will pull to try to keep the bubble inflated.  I wouldn't put anything past them, to include just straight up giving people money to make up losses/negative equity.

The problem with that is that it now p*isses off more folks than it helps, well almost, a big voter bloc nonetheless (assuming enough people can join the dots about how high house prices are the worst thing to happen to working people, I think they now can) The game going forward IMO is to avoid any more political fallout from the bailout years (hard to do now) and try to figure out a way to do a "soft landing" so they can milk votes from owners and priced outs, but as we have so vividly seen with Brexit they are very likely to **** it up badly. Buy popcorn :D

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1 minute ago, Discustard said:

Agree with everything you said.  I too am waiting with my deposit.

The only question is what outrageous stunt the government will pull to try to keep the bubble inflated.  I wouldn't put anything past them, to include just straight up giving people money to make up losses/negative equity.

Surely it won't even matter if they do come up with a load of stupid stunts.

Just giving money away, and it will need to be huge sums, will make it obvious even to the HTB boneheads that the market is totally false and has been for a long time. What plan can they come up with that won't expose their complete lack of credibility? 

And those huge sums would have to be found from an empty trough.

I still reckon they'll most likely form the next government. 

 

 

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3 minutes ago, Bluestone59 said:

Just giving money away, and it will need to be huge sums, will make it obvious even to the HTB boneheads that the market is totally false and has been for a long time.

I think you over-estimate people's intelligence.  HTB itself is a shameless bung to prop up a false market, but the majority of people don't realise this and happily accept the 'free' money thinking it is helping them.

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Since it's a global bubble, the pinprick that bursts it could come from anywhere. 

The English government can't stop the tsunami whatever it does. 

So we wake up one morning and... 

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51 minutes ago, 24gray24 said:

Since it's a global bubble, the pinprick that bursts it could come from anywhere. 

The English government can't stop the tsunami whatever it does. 

So we wake up one morning and... 

I think that's right...BOE and UKGOV..pretend they are in control but they have been sailing through calm waters these last 5 years or so, it won't take much for the waters to become choppy and all the distortions to become very apparent and cause the ship to founder. 

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1 hour ago, Bluestone59 said:

Surely it won't even matter if they do come up with a load of stupid stunts.

Just giving money away, and it will need to be huge sums, will make it obvious even to the HTB boneheads that the market is totally false and has been for a long time. What plan can they come up with that won't expose their complete lack of credibility? 

And those huge sums would have to be found from an empty trough.

I still reckon they'll most likely form the next government. 

 

 

They won`t give money away, they have to keep up the belief among the sheeple that money is a scarce hard to get resource which you have to borrow at interest to buy big things (like houses) helicopter money/debt jubilee type stunts only undermine the illusion, and for that reason won`t happen IMO. The political capital is now in crashing house prices I think, but it is a tricky wire to walk as the banks will need something else to loan big chunks of money against, what could it be? Houses were a one off classic playing chip for the banks to lend loads on, I can`t see what takes up the lending slack?

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47 minutes ago, pizza said:

I think you over-estimate people's intelligence.  HTB itself is a shameless bung to prop up a false market, but the majority of people don't realise this and happily accept the 'free' money thinking it is helping them.

The people who accept the money may be either stupid or just feel they have run out of options.

My thinking is, yes they got away with it last time but can they really pull it off again?  If the scale of the problem becomes as big as it might then hiding what they're up to just won't work. We'll see.

 

 

 

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2 hours ago, Discustard said:

The only question is what outrageous stunt the government will pull to try to keep the bubble inflated.

Hmm... off the top of my head:

  • 120% mortgage
  • HTB for old properties too
  • Inter-generation mortgage or use parents' properties as collateral 
  • PCP (personal contract purchase) equivalent for properties

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When the market crashes, I wonder if we will see HTB keys getting handed back on a big scale. Especially once the high maintenance fees kick in when they are no longer new anymore and the poor build quality start to show. The big new build blocks of flats, with 2 lifts to service, non stop interior decorating from renters coming and going damaging the hallways, flashy glass exteriors with regular cleaning required etc etc it’s going to be savage.  I don’t know to much about htb but I believe you have to start paying interest on the loaned equity after 5 years as well. Very bad news for those who don’t look past tomorrow with debt up to there eyeballs with every penny accounted for.

Already couples separating, needing somewhere bigger to start a family are facing a substantial loss in the majority of cases.

Surley its not if it’s when? 

 

 

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5 minutes ago, peter_2008 said:

Hmm... off the top of my head:

  • 120% mortgage
  • HTB for old properties too
  • Inter-generation mortgage or use parents' properties as collateral 
  • PCP (personal contract purchase) equivalent for properties

HTB on old properties is one of my biggest fears. 

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21 minutes ago, 2rocketman said:

HTB on old properties is one of my biggest fears. 

Even if it is bonkers, you will have the choice to use it, if it happens

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2 hours ago, Bluestone59 said:

Surely it won't even matter if they do come up with a load of stupid stunts.

Just giving money away, and it will need to be huge sums, will make it obvious even to the HTB boneheads that the market is totally false and has been for a long time. What plan can they come up with that won't expose their complete lack of credibility? 

And those huge sums would have to be found from an empty trough.

I still reckon they'll most likely form the next government. 

 

 

while we have paper in the printer the trough is never empty.  Although many horses can be led to water not all will drink.  There is lots they can do to stop a collapse but it will catch up one day, unless they can separate mortgage debt from other debt somehow to keep everything else going. 

best just to leave it alone with big sign saying DNR.  

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26 minutes ago, 2rocketman said:

HTB on old properties is one of my biggest fears. 

did they not do that already ?? under 600k 

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2rocketman, I am West London-based too and agree with your assessment that things will look very different in a year's time. New developments are planned here and they can't sell the flats just completed.

I always thought things would change in "a couple of years." That became a rolling couple of years! But I'll nail my colours to the mast and say it's this year that the wider public will see as the start of the correction/crash/reversion to the mean/end of insanity. Delete as appropriate.

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6 hours ago, MARTINX9 said:

I wouldn't bank on anything while Mark Carney and Phil buy to let Hammond are still in their jobs!

 

That pair are very damaging to our cause, but there are so many factors now out of their control. Sentiment has turned. 

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8 hours ago, longgone said:

did they not do that already ?? under 600k 

If you are using the help to buy equity loan scheme, you can only purchase a new-build property from a participating registered house builder. 

 

 

 

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There comes a moment when you start begging young people not to buy now, and they laugh at you like you're past it, and they wouldn't lend unless they knew you could pay it back. 

Jeremiah or cassandra: thankless job. 

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It's too soon in the political cycle for the govt to intervene. See what they do late next year....

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10 hours ago, pizza said:

I think you over-estimate people's intelligence.  HTB itself is a shameless bung to prop up a false market, to destroy any price discovery  but the majority of people don't realise this and happily accept the 'free' money thinking it is helping them.

Yes sorry for the pedantry.... but the term 'propping up' implies 'doing the right thing' whereas, in truth (?) 'destroying price discovery' describes honestly what is being done.

?

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I don't think the wait is over personally.

Prices are falling, in the areas that I see. But at present this is just dropping to a rung or two below. On my watchlist places are still being snapped up pretty quickly if priced under the current market asking prices (which is still full of people trying desperately to ask for last years prices).

For a real crash to happen, either sentiment has to turn much more, and there needs to be larger barriers against high prices.

I think the first is difficult, after all, people need somewhere to live. A lot of people on the site here would regard getting a house valued at £350,000 today for £250,000 next year as a success, even though that price is still way above what it was 10 years ago. There is only so much you can wait, and the likelihood of a 'soft landing' (in which the decline is gained via no nominal price movements or small decreases over a long period) seems much more palatable to the government.

The second part is that credit is still easy to come by. I believe there is a lot of pent up demand waiting at lower prices both from OO and BTL, and they can get the finance. Higher interest rates would be a powerful force because people simply wouldn't be able to afford the repayments even if they wanted the house or the yields won't stack up.

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