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Will Corona virus cause a house price crash?


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"Agree about not being clear about where the cash is coming from to maintain the house prices. But properties are still being listed daily even now at the same pre crisis prices."

 

These will be listings of transactions that have fallen through. I pulled out of a purchase last week. The agent has just re-listed the property at 15k above sale agreed price from January. Go figure.

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13 minutes ago, desertorchid said:

"Agree about not being clear about where the cash is coming from to maintain the house prices. But properties are still being listed daily even now at the same pre crisis prices."

 

These will be listings of transactions that have fallen through. I pulled out of a purchase last week. The agent has just re-listed the property at 15k above sale agreed price from January. Go figure.

Well as I pointed out estate agents have had a special 1 year bailout on business rates so perhaps they can afford to wait for their commission? No such luck for equivalent high street firms like solicitors,  vets, accountants, dentists, chiropodists and chiropractors and physios - who actually add some value to humanity but get no help at all. Sums up the government's priorities for saving businesses - shameful frankly!

Edited by MARTINX9
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I am unsure of a crash of the likes mentioned here and elsewhere will occur.

In 2007/2008 the sentiment was pretty much the same as now and the % reductions branded about was stunning -  some said 20%, 30% even 50%. 

COVID-19 has set tongues wagging again and a repeat of the same chatter is going on - submitted an offer on a property last quarter and the vendor, understandably, pulled property out the market when COVID-19 became what it is in the UK.

I don't know what the government will do but just as in 2008 they'll probably find a way to keep property from crashing 20%, 30%, 50% whatever. I am watching China to see how they come along and how their containment and lock down relaxation may pave the way for others countries to follow as obtaining a vaccine this year (unless some already existing drug works on it) is a pipe dream. Priority now has to be survival i.e. property can take a back seat.

Expecting 20%, 30%, 50% falls from COVID-19 is just a guess frankly if the world is in lock down for say 6 or 9+ months then house price will not be what would be uppermost in any ones mind bar the wealthy as just retaining or having a job to get food or survival will be the main say. Finally if people are right and some % falls do occur then sheer pent up demand will push them up again with gazumping probably being the norm - it is after all a competitive market.

Then again - what do I know - so many assumptions everywhere

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3 minutes ago, magneticworld said:

 then sheer pent up demand will push them up again with gazumping probably being the norm - it is after all a competitive market.

 

Non sequitur old boy

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17 minutes ago, magneticworld said:

I am unsure of a crash of the likes mentioned here and elsewhere will occur.

In 2007/2008 the sentiment was pretty much the same as now and the % reductions branded about was stunning -  some said 20%, 30% even 50%. 

COVID-19 has set tongues wagging again and a repeat of the same chatter is going on - submitted an offer on a property last quarter and the vendor, understandably, pulled property out the market when COVID-19 became what it is in the UK.

I don't know what the government will do but just as in 2008 they'll probably find a way to keep property from crashing 20%, 30%, 50% whatever. I am watching China to see how they come along and how their containment and lock down relaxation may pave the way for others countries to follow as obtaining a vaccine this year (unless some already existing drug works on it) is a pipe dream. Priority now has to be survival i.e. property can take a back seat.

Expecting 20%, 30%, 50% falls from COVID-19 is just a guess frankly if the world is in lock down for say 6 or 9+ months then house price will not be what would be uppermost in any ones mind bar the wealthy as just retaining or having a job to get food or survival will be the main say. Finally if people are right and some % falls do occur then sheer pent up demand will push them up again with gazumping probably being the norm - it is after all a competitive market.

Then again - what do I know - so many assumptions everywhere


The world has changed. Governments may avoid saying it publically but once this pandemic has been dealt with there will be a slow movement away from relying on China's manufacturing base. The world will look quite different, 10-20 years from now. 

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We cannot compare this to 2007-8 for many reasons, one of the principal ones being we were still recovering from that crisis when this one hit. 2007-8 was a punch to the stomach. Still trying to get our wind back we've just been cudgelled over the head.

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19 hours ago, MARTINX9 said:

Well as I pointed out estate agents have had a special 1 year bailout on business rates so perhaps they can afford to wait for their commission? No such luck for equivalent high street firms like solicitors,  vets, accountants, dentists, chiropodists and chiropractors and physios - who actually add some value to humanity but get no help at all. Sums up the government's priorities for saving businesses - shameful frankly!

Without money flowing through the other businesses the EA`s are F*ucked anyway?

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6 hours ago, magneticworld said:

I am unsure of a crash of the likes mentioned here and elsewhere will occur.

In 2007/2008 the sentiment was pretty much the same as now and the % reductions branded about was stunning -  some said 20%, 30% even 50%. 

COVID-19 has set tongues wagging again and a repeat of the same chatter is going on - submitted an offer on a property last quarter and the vendor, understandably, pulled property out the market when COVID-19 became what it is in the UK.

I don't know what the government will do but just as in 2008 they'll probably find a way to keep property from crashing 20%, 30%, 50% whatever. I am watching China to see how they come along and how their containment and lock down relaxation may pave the way for others countries to follow as obtaining a vaccine this year (unless some already existing drug works on it) is a pipe dream. Priority now has to be survival i.e. property can take a back seat.

Expecting 20%, 30%, 50% falls from COVID-19 is just a guess frankly if the world is in lock down for say 6 or 9+ months then house price will not be what would be uppermost in any ones mind bar the wealthy as just retaining or having a job to get food or survival will be the main say. Finally if people are right and some % falls do occur then sheer pent up demand will push them up again with gazumping probably being the norm - it is after all a competitive market.

Then again - what do I know - so many assumptions everywhere

Transactions are half what they were in 2006/7, "Pent Up Demand" is only a MSE fantasy meme, people who have just come through a major financial shock won`t be buying into a falling housing market, why would they?

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1 hour ago, dances with sheeple said:

Transactions are half what they were in 2006/7, "Pent Up Demand" is only a MSE fantasy meme, people who have just come through a major financial shock won`t be buying into a falling housing market, why would they?

Yeah but the pent up demand is not any old pent up demand. It's sheer.

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Hear ye, hear ye! The analysts at Knight Frank have spoken:

https://www.theguardian.com/business/2020/apr/06/house-prices-will-not-fall-far-despite-lockdown-says-study?CMP=share_btn_link

"But prices will fall by only 3% and will rebound next year, according to global consultancy Knight Frank."

In the report they also state their predictions are based on the UK economy growing by 4.5% next year.

In addition, the "global consultancy" Knight Frank predicts:

UK prices will rise 5% in 2021.

North Korea will join Eurovision.

Britney Spears will win the Nobel Prize for Physics.

 

Edited by Voice of Doom
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On 03/04/2020 at 23:27, Confusion of VIs said:

2003-4 was pretty expensive. 1996-7 was the time to buy, I had a next door neighbour moved in in early 1997, at the time we thought he was nuts buying as nothing was selling but he sold up in about 2003 tripled his money and semi retired to Spain at age 32.   

Hindsight is a wonderful thing.

Ha. Bought my first house in December 1996. Happy Days.

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On 05/04/2020 at 13:46, spacedin said:


The world has changed. Governments may avoid saying it publically but once this pandemic has been dealt with there will be a slow movement away from relying on China's manufacturing base. The world will look quite different, 10-20 years from now. 

I hope so, too late for me who's line of work was hived off to India some time ago, same for the wife but in reverse.  When they had that terrorist attack in India by some islamic extremists I thought that might be a reminder that we (our governments that is)  should be thinking about our own security by not operating the majority of our operations offshore no matter how cheap it was. I was wrong of course.  I think they will be back to their old tricks once this has blown over,  cheapest option will always win, It might not be China directly but may well be Chinese firms operating in SE Asia.

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1 hour ago, highcontrast said:

Extremely dodgy margin covering imo, they already make a ludicrous spread.

Why on earth, we don’t have some kind of universally available bank account (for simple stuff like purchases ) so that people don’t need a high street bank I have no idea......well I do have an idea, but it’s bloody shocking.

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Hi all,

We were ready to complete our purchase then the lockdown happened so had to stall. We have contracts here ready to sign which we’re posted to us a few weeks ago however with all what’s going on we still have not signed them. We are an older couple downsizing and got a small mortgage already in place. I’m just curious now as to whether the house prices will fall. Any info would be greatly appreciated. Should I sign and return and go ahead or should I hang on even longer. I reckon the market will slowly start over the next few weeks so I need to decide by then. 
Thankyou 

Mark

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On 3/12/2020 at 1:33 PM, 50sQuiff said:
On 3/12/2020 at 1:33 PM, 50sQuiff said:

Will Coronovirus cause a House Price Crash? No, of course not.

But it is the catalyst for the collapse of an untenable and incoherent international monetary system and its endemic asset bubbles and distortions.

This will cause a House Price Crash.

It seems like the end game has started, but even the demoralised bears can't see it yet. Many of us have been preparing for this for a long time, so it is quite shocking to see it unravel so quickly.

Prepare for the central planners' "whatever it takes" phase, much quicker than anticipated.

 

My view as well, I have probably suspected for more than a decade now that the UK property market was so maxed out that it just needed that one event, I am amazed it took this long. I have only just signed up to this website after years of reading the posts, I just thought there was nothing to say and whatever I did have to say was being said.

To me it has been like one of those road runner cartoons where he runs off the edge of a cliff and is frozen for a while knowing he will fall or a big one ton weight hanging over your head with rope that has a one ton one ounce breaking strain, you just know it is going to come crashing down at some point. This virus is the trigger, it really is this time,  and as tragic as that is it will not be the cause of the housing crash, that was always coming.

I am posting on here now after reading this thread, to be more precise it was a post about the virus causing a painful time for present homeowners that rattled me into action and how one particular poster said they felt "sorry for them" which was a kind thought but not one I share wholeheartedly, which another poster articulated perfectly in that he felt no pity for them at all after the years of social stigma he had endured, quite often done on purpose.

Right now I am probably no worse or better off than most people in these times, but my one big advantage is toughness through years of being priced out and belittled. What should be scaring me isn't, my business which has an OK turnover and enables me to live a comfortable life in many ways in a cosy little village. I had work up until September at least which is great for my line of work, my customer base is brilliant, but for now I have as good as lost 90% of my bookings which does not frighten me in the least. 

I have savings and am confident the work will come back when the wheels start turning again, but I am one of the lucky ones that can return and be more aggressive in pricing on the down side if needed, I can live OK on less money, I have zero debt and no huge mortgage, it will be all worth it for me if the crash is 30% or even greater which is very much on.

So, sorry to digress all over the place? This corona virus is 100% going to cause prices to fall, if it doesn't then I or nobody on here has a clue how anything works in this world

 

 

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Welcome! Good to hear your views. I, too, lurked for ages then joined and started contributing a couple of years ago as I could see things changing... slowly.

Given what I'd read about credit bubbles and private debt - inspired by Steve Keen and many on here - I thought the trigger might come from China. Looks like it has and in a way no one I know of predicted.

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On 25/03/2020 at 07:17, HovelinHove said:

Er, where have you been the past week? Removal men won’t be able to come. Solicitors and estate agents won’t be able to work. Travel and being outside are only allowed if essential, and moving house is not considered essential.

I moved into my house.The solicitors both worked, so did the estate agents from home. Travel to your home is essential and that's what moving house is.

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9 hours ago, bear.getting.old said:

I moved into my house.The solicitors both worked, so did the estate agents from home. Travel to your home is essential and that's what moving house is.

Interesting, I've heard different stories, but I guess people can interpret things according to their own. Either way, the market is complete toast. When VIs are saying 10%, it will be 20-30%. No one is viewing, unemployment is rising, people can't afford rents etc. The market is in nose dive, and the banks are already struggling bailing out businesses.

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On 04/04/2020 at 19:42, bobhope said:
  • If we are looking at a peak of 1k extra deaths day per day for 70-85 year olds, that means an extra 360k per year (so about double the normal number for this cohort) - huge downward pressure at the top end of the market.

I know you said these were assumptions but there are some serious mistakes in your assumptions!

One clue is in the work PEAK, you cannot take the peak number, multiple by 365 and come up with an extra 360,000 deaths per year. You have to average the numbers over a year so the actual figure is perhaps 50%, 30%, 20% or even less of the peak figure over the whole year.

Also you claimed these were EXTRA DEATHS. We don't know that yet and perhaps never will. On average 17,000 people die in the UK from flu every year although it has been as high as 28,000 - how many COVID-19 victims would have died from normal flu anyway?

Also many of those 70-85 year olds (especially towards the top of that age range) will already be living in a care home rather than their own home so the effect of those on the housing market will be nil.

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  • 433 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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