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Will Corona virus cause a house price crash?


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I don't think I have seen a Corona virus thread purely relating to HPC.

 

So as per the original point of this forum, will Corona virus cause a house price crash?

 

or will even looser money / currency devaluation cause prices to remain the same / rise?

 

 

Edited by reddog
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Yes I think it will. No one I talk to thinks it will, which just shows how ingrained it is that house prices will magically not fall. The two major vectors are going to be major jobs losses and the housing rich (oldies) shuffling off this Earth.

The only way they can stop this is hyperinflation and that only stops nominal falls.

Edited by LetsBuild
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Shutting business and cancelled orders, along with zero tourism is going to close businesses quickly.

People will lose their jobs.

Despite headline 3month mortgage holiday published yesterday, it won't help everyone.

People will go into arrears on mortgage.

Houses will be repossessed and hpc will be triggered.

As prices drop, banks will do margin calls on highly leveraged valuations of property and landlords will need to release equity.

They will be forced sellers.

This is chess, if you can look 4or 5 moves ahead you can prepare. If you react to the last move then you will lose the game.

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If you think government are turning on the taps to keep house prices high now, just wait for a few more months. Boomers can't see their houses go down in price, they worked hard for that. I imagine we'll see a series of obscene measures to prop them up

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14 minutes ago, crazypabs said:

Shutting business and cancelled orders, along with zero tourism is going to close businesses quickly.

People will lose their jobs.

Despite headline 3month mortgage holiday published yesterday, it won't help everyone.

People will go into arrears on mortgage.

Houses will be repossessed and hpc will be triggered.

As prices drop, banks will do margin calls on highly leveraged valuations of property and landlords will need to release equity.

They will be forced sellers.

This is chess, if you can look 4or 5 moves ahead you can prepare. If you react to the last move then you will lose the game.

people wont be forced out. poor home owners got ill and will be bailed out, whether that is payment holidays or refinancing adding another few years to the mortgage. this is what will happen

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I think the UK is not on the alarming trajectory of cases seen elsewhere. We could follow Japan, which has dropped right off the radar as a hotbed of coronavirus. If this is correct, we may take a relatively minor economic hit - but the BoE's pumping actions will push house price growth past 5% this year. 

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9 minutes ago, rantnrave said:

I think the UK is not on the alarming trajectory of cases seen elsewhere. We could follow Japan, which has dropped right off the radar as a hotbed of coronavirus. If this is correct, we may take a relatively minor economic hit - but the BoE's pumping actions will push house price growth past 5% this year. 

Mate... the exponential progression is the same just delayed by a few days.

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Who would put their house on the market right now, "yeah lets invite in a bunch of strangers to wander around our house"

The market will die from lack of activity, but this will also prevent price discovery. By christmas time, Estate Agents will be desperate for a sale, any sale, at any price.

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Don't think the Budget contained much bonuses for buyers...more funds to build 'affordable' housing may be good for the market but going on what we have seen so far housebuilders ain't really interested in building them.

I don't think we can afford to support everyone.... there will be people losing jobs, people dying... there will be forced sales among the usual people kite-flying.

Stuff like this has to be kept out of the media at all costs, as house price deflation becomes self-perpetuating. Why buy now if you think prices will fall?

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10 minutes ago, Burbujista said:

Mate... the exponential progression is the same just delayed by a few days.

Can you back that up re the curve for Italy and Spain?

UK was very quick to trace contacts for the first cases. That could have a very big impact in preventing an Italy like scenario.

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The house of cards was only propped up in 2009.

No issues were really resolved.

I saw an interview with the Badger himself yesterday evening (Alistair Darling).

When asked about similarities between now and then he stated that they knew what they were up against in 2009 and thus knew what to do...just.

Now its different...so many unknowns. He looked quite ashen actually.

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Those renting, working with few in work benefits, low paid insecure jobs, hours available uncertain, customers available uncertain, suppliers uncertain, income uncertain...no sick pay, no holiday pay or non contributional pension......living on an overdraft arrangement......hand to mouth.......what help for them??

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14 minutes ago, winkie said:

Those renting, working with few in work benefits, low paid insecure jobs, hours available uncertain, customers available uncertain, suppliers uncertain, income uncertain...no sick pay, no holiday pay or non contributional pension......living on an overdraft arrangement......hand to mouth.......what help for them??

None

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6 minutes ago, winkie said:

What you mean those in society that if stayed at home would have a visible negative impact on society.....those that grease the cogs of the economy.......keeping everything working.?

Its gonna be tough

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1 hour ago, rantnrave said:

I think the UK is not on the alarming trajectory of cases seen elsewhere. We could follow Japan, which has dropped right off the radar as a hotbed of coronavirus. If this is correct, we may take a relatively minor economic hit - but the BoE's pumping actions will push house price growth past 5% this year. 

The number of tests is also decreasing with time though - we just don't have the capacity to do them it seems.

Allegedly number of tests will ramp up from 1.5k to 10k in the next days....so I would expect cases to jump back up, given my first sentence?

OTOH as someone else mentioned...we may have been better at tracing contacts, and there is a real effect w.r.t Italy. I have read in Italy there was a "super spreader" on the lose for a long time, which they could and should have tested and quarantined. i.e. they tried to trace and they messed up.

Edited by MancTom
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1 hour ago, hurlerontheditch said:

people wont be forced out. poor home owners got ill and will be bailed out, whether that is payment holidays or refinancing adding another few years to the mortgage. this is what will happen

I hope they don't bail out BTL too.

They purchased property as an investment, and are happy to take the profits in the good times.  They should suffer the losses in the hard times.

I wouldn't want tenants to be made homeless because of a BTL mortgage defaulting.  Hopefully there is, or will be some protection for such a scenario.

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1 hour ago, winkie said:

Those renting, working with few in work benefits, low paid insecure jobs, hours available uncertain, customers available uncertain, suppliers uncertain, income uncertain...no sick pay, no holiday pay or non contributional pension......living on an overdraft arrangement......hand to mouth.......what help for them??

Yes no help at all for private sector renters yet who are the most vulnerable people of all housing wise as they lack security and live at risk of eviction at two months notice even if they pay their rent. They are most likely to be living pay check to pay check and if they don’t work can’t pay the bills. 

Will landlords get mortgage holidays but still be expecting tenants to pay rent?

There are nearly 10 million private renters if they can’t work or fall ill - what help for them - nothing so far?

Edited by MARTINX9
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The market, certainly in the South East is significantly pulled up by the high end. Middle Eastern and Russian oil money, dodgy South East Asian business and govt money, London finance money.

That's, basically, disappeared overnight?

After the 1929 stockmarket crash New York property cratered. Same thing applies imho. London will be ground zero, and anywhere that's been bubbly will fall proportionately to how bubbly it was. So the North East might not get hit as hard, say. Timescales uncertain.

The govt simply haven't got the firepower to stop this now imho.

One other thing. Markets crash because people think they can't.

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I could see rural property becoming more attractive for isolation purposes but London less attractive.

I expect the Govt and Carney for now will do whatever it takes to keep prices as high as possible - the rate cut yesterday was just the start.

Those poor homeowners and landlords must be protected at all costs from their financial choices going pear shaped. But those 10 million ‘scummy private renters’ who are likely to be paying far more per month for their housing costs can just be left to rot?!

 

Edited by MARTINX9
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