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Will Corona virus cause a house price crash?


reddog
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22 hours ago, Smiley George said:

If this doesn't cause a HPC, then you can pretty sure the chances of one ever happening are pretty slim.

If the financial crisis which is unraveling before our very eyes doesn't cause a correction in house prices, I'd be amazed.

I'd given up on a HPC so I'm actually buying in the North. About 2 weeks from exchange. Starting to wonder if it's such a good idea. It is a cheap house even for the (ok) area, owner selling cheap because of circumstances. Hmmmm but will there be many more better bargains after a year.... waited too long already though

Edited by bear.getting.old
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Applying Betteridge's law, then Covid19 won't directly cause a HPC.  The resulting drop in Economic demand should trigger the levers for HPC, but we've seen enough triggers from 2000 and every time a new way to re-animate the zombie economy has been found.

What I do think is different is that the elites, who have been happy to let the charade continue, are now discreetly looking for the exit - cash is king - Gold and Bitcoin are dropping. If that cash is in Dollars, Yen, Rubles, Yuan, or Euros the the £ is toast and there will be IRs and Margin calls galore. (I don't see what the £ has against any of the above)

 

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People are piling into cash to take advantage of the fire sale. 
 

Even gold goes down short term in such situations as people suddenly need cash, it’s a short term liquidity squeeze. and panic.

gold will probably rocket in a few weeks. 

No idea about bitcoin, this is its first serious test, probably a bit too young to be an established value store and acting more like a volatile tech share, but bitcoin will never be worth zero, it’s continued existence just makes it worth more in the long run 

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Just watched channel 4 news. Their economics commentator was worried about job losses in the economy. Sadly, unemployment is only thing that will cause house price crash in sterling in my opinion. Doesnt matter how cheap debt is, nobody will lend to someone without a job. If someone fears they will be laid off, a huge mortgage becomes less appealing. 

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9 hours ago, bear.getting.old said:

I'd given up on a HPC so I'm actually buying in the North. About 2 weeks from exchange. Starting to wonder if it's such a good idea. It is a cheap house even for the (ok) area, owner selling cheap because of circumstances. Hmmmm but will there be many more better bargains after a year.... waited too long already though

I'm in a similar position - where are you buying, .bear.getting.old? Been waiting for a correction for the last 14 years, not getting any younger and got to the point where I really just need a place I can make the house myself, partner and my son need. Agreed a good deal, on a house where the owners needed to sell quickly, about a week ago. I really want the house but I can't help but feeling like this may be the worst of times to buy. Also, got an email from my main client today saying I may not have any work for a few months though I have savings (which have dropped 35% the last few weeks ?). I don't know whether to feel really annoyed or happy that I still have the chance to dodge the bullet! 

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I feel lucky that I’m renting at the moment with most of my almost 7 figure housing deposit in cash. Fifteen percent was in equities so I’ve still lost a chunk but could be much worse.

We’d offered on 3 different houses over the past 2 months after receiving eviction notice from our crazy landlord (that’s another story but we’ve discovered she evicts every year as she likes new tenants. B1tch). We missed out on all 3, the last 2 as we didn’t love them enough to offer what the seller wanted.

Now I’m concerned tho...

Sitting on cash  doesn’t feel safe too right now. I’m reducing individual accounts to just above the FCA limit but I’m worried inflation will rise and start wiping out the size of our deposit. I was earning about 1.5% before tax but that will plummet to almost zero now with the base rate cut. Also in crazy times governments have been known to help themselves to savings (Didn’t Greece do that?).

I’m now thinking of moving a lot of it across to my investment account and possibly gambling it on a variety of global equity funds if the markets drop much lower next week. Markets will recover eventually to at least above current levels. If they don’t I think we’ll have bigger concerns.

its worrying times. I’d feel safer as a home owner knowing that even in a HPC you still have the roof above your head.

Im also in a high risk job (aviation)

Whats everyone else doing with their deposits?

 

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This is going to cause a recession, the travel industry and hospitality are going to be hit hard. The aviation industry will be badly hit, these layoffs will soon be biting pilots are the sort of people who have a new house and a new car to pay for. 25% drop in some areas.

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Piling into cash for 'fire sale' prices will only support a dead cat bounce. Once those funds are wiped out, that will set the panic off. I can see future layoffs making this brutal, but we are past the point of gentle corrections.

The UK economy is beset with Gangrene, amputation is now the only option

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8 hours ago, dirtysteve said:

I feel lucky that I’m renting at the moment with most of my almost 7 figure housing deposit in cash. Fifteen percent was in equities so I’ve still lost a chunk but could be much worse.

We’d offered on 3 different houses over the past 2 months after receiving eviction notice from our crazy landlord (that’s another story but we’ve discovered she evicts every year as she likes new tenants. B1tch). We missed out on all 3, the last 2 as we didn’t love them enough to offer what the seller wanted.

Now I’m concerned tho...

Sitting on cash  doesn’t feel safe too right now. I’m reducing individual accounts to just above the FCA limit but I’m worried inflation will rise and start wiping out the size of our deposit. I was earning about 1.5% before tax but that will plummet to almost zero now with the base rate cut. Also in crazy times governments have been known to help themselves to savings (Didn’t Greece do that?).

I’m now thinking of moving a lot of it across to my investment account and possibly gambling it on a variety of global equity funds if the markets drop much lower next week. Markets will recover eventually to at least above current levels. If they don’t I think we’ll have bigger concerns.

its worrying times. I’d feel safer as a home owner knowing that even in a HPC you still have the roof above your head.

Im also in a high risk job (aviation)

Whats everyone else doing with their deposits?

 

Am I reading that right you have nearly a million pounds in cash and your choosing to rent ....with all the uncertainty, cost and general aggro that entails ?

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I thought the EU had just quietly removed the protection limit on bank accounts?

dont know where the UK stands.

the only safe thing you can do to maintain VALUE of your savings is a permanent portfolio approach.

dont get too tied up with the stated ‘£’ amounts as that itself is a moving indicator 

sitting mostly in cash is just as risky as mostly in shares, or gold, or long dated bonds.

have a mix of them all. 

playing silly buggers with your life savings baffles me.

also a house is always work a house regardless of the £ amounts. it just depends if you can stomach living in your ‘a house’ and seeing it’s £ amount fluctuate. At the end of the day a house is worth a house. 

or just live in it and stop obsessing about the £ amount. live what time you have on the earth in improved comfort and less stress.

people are morons, life is short, day to day is your life, not some distant goal, learn to be happy with a humble life, learn to enjoy work, give yourself as much security as you can get (it’s all an illusion anyway) I much rather have a simple comfortable life, than constantly chase money, high stress etc, and that doesn’t mean I can’t retire early either, it actually facilitates it 

I feel sorry for those people who are cursed with ego, or the need to impress. empty lives. 

Edited by jiltedjen
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13 hours ago, hughjass said:

The aviation industry will be badly hit, these layoffs will soon be biting pilots are the sort of people who have a new house and a new car to pay for. 25% drop in some areas.

Yep, not just operational staff either. I effectively work for Airbus and am bricking it :unsure:

 

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If they 

6 hours ago, jiltedjen said:

I thought the EU had just quietly removed the protection limit on bank accounts?

dont know where the UK stands.

the only safe thing you can do to maintain VALUE of your savings is a permanent portfolio approach.

dont get too tied up with the stated ‘£’ amounts as that itself is a moving indicator 

sitting mostly in cash is just as risky as mostly in shares, or gold, or long dated bonds.

have a mix of them all. 

playing silly buggers with your life savings baffles me.

also a house is always work a house regardless of the £ amounts. it just depends if you can stomach living in your ‘a house’ and seeing it’s £ amount fluctuate. At the end of the day a house is worth a house. 

or just live in it and stop obsessing about the £ amount. live what time you have on the earth in improved comfort and less stress.

people are morons, life is short, day to day is your life, not some distant goal, learn to be happy with a humble life, learn to enjoy work, give yourself as much security as you can get (it’s all an illusion anyway) I much rather have a simple comfortable life, than constantly chase money, high stress etc, and that doesn’t mean I can’t retire early either, it actually facilitates it 

I feel sorry for those people who are cursed with ego, or the need to impress. empty lives. 

If you are concerned about losing money why not just draw it out and stick it under the bed. ?  all the others are investing and that = risk.  when this thing really takes hold no where is going to be safe.  personally i am happy to leave it where it is under the threshold in all accounts. until such time is good to invest some of it. still going to leave my 50k of pbonds intact now IR rates are even lower.

agree though people are morons and some are only concerned of getting richer that is their life. bit like scrimping on things you want when you are young so potentially you have more when old, but old may never come. no guarantees. 

The elderly might be finding that out in real time soon. 

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I doubt this will cause any major movement to house prices. Its mainly histeria, basically only those over 60+ seem likely to die from the virus.

As we see some layoffs and coronavirus used as an excuse, as soon as this passes within 2-3 months people will realise it's not as bad as it seems....

BOE move interest rate to 0.25, pushing up house prices.

Deaths in the older population will also lead to some gran kids now having deposits...

People who loose their jobs will just been given payment holidays on their mortgages, most banks are willing to go up to 90%LTV. It would take me years of not paying to loose my house, while I'm not paying house prices are rising actually faster than my mortgage yearly repayment.

The government will not allow a house price... 

If we have some hyperinflation, that would be great as it would reduce my mortgage debt.

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13 minutes ago, Speed1987 said:

I doubt this will cause any major movement to house prices. Its mainly histeria, basically only those over 60+ seem likely to die from the virus.

As we see some layoffs and coronavirus used as an excuse, as soon as this passes within 2-3 months people will realise it's not as bad as it seems....

BOE move interest rate to 0.25, pushing up house prices.

Deaths in the older population will also lead to some gran kids now having deposits...

People who loose their jobs will just been given payment holidays on their mortgages, most banks are willing to go up to 90%LTV. It would take me years of not paying to loose my house, while I'm not paying house prices are rising actually faster than my mortgage yearly repayment.

The government will not allow a house price... 

If we have some hyperinflation, that would be great as it would reduce my mortgage debt.

The global recession that follows may have a say on that lack of major movement you don’t think will happen.

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15 minutes ago, Speed1987 said:

Deaths in the older population will also lead to some gran kids now having deposits..

It will also mean their houses will become vacant, and probably be sold.

People worrying about job security will not buy.

People who actually lose their jobs will not buy.

Unless there is a recession the base rate is not going to stay at 0.25% for long.

 

Edited by gp_
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23 minutes ago, Speed1987 said:

I doubt this will cause any major movement to house prices. Its mainly histeria, basically only those over 60+ seem likely to die from the virus.

As we see some layoffs and coronavirus used as an excuse, as soon as this passes within 2-3 months people will realise it's not as bad as it seems....

BOE move interest rate to 0.25, pushing up house prices.

Deaths in the older population will also lead to some gran kids now having deposits...

People who loose their jobs will just been given payment holidays on their mortgages, most banks are willing to go up to 90%LTV. It would take me years of not paying to loose my house, while I'm not paying house prices are rising actually faster than my mortgage yearly repayment.

The government will not allow a house price... 

If we have some hyperinflation, that would be great as it would reduce my mortgage debt.

Well around here that means all home owners might die as the average over is well over 60.

Also I am one the biggest employers in my small touristic area.

Despite doing quite well its taken me ages to get near buying a house as when i could afford 350 it went to 400, when i had 400 it went to 450.

I was just about to admit defeat and close on a property for 475,000 and this has happened.

Business is holding up but 10-20% down on last year having previously been 10%+ up until this hit.

There are at time of posting no corona cases in Norfolk (I know there probably are).  Once this happens officially I expect it to crater.  

So I now have a couple of weeks of this and then the shutdown will it be for a few weeks or a month anyhow it will cost me 20,000£ plus (not lost potential earnings just the cost of stasis).

Needless to say I have pulled out as I am keeping the house money close at hand if things do not get better for an extended period.

Who the hell is going to buy a house this year (unless a vaccine) unless they are getting a bargain?

Over the next few weeks I expect auctions to be cancelled, jobs to be lost and a lot of people to die.

If you have to sell you are going to have a hard time getting someone to view it.

Crash over 20% probably no but I would want 20% off to buy right now with all this over my head.



 

 

Edited by Fromage Frais
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23 minutes ago, Fromage Frais said:

Well around here that means all home owners might die as the average over is well over 60.

Also I am one the biggest employers in my small touristic area.

Despite doing quite well its taken me ages to get near buying a house as when i could afford 350 it went to 400, when i had 400 it went to 450.

I was just about to admit defeat and close on a property for 475,000 and this has happened.

Business is holding up but 10-20% down on last year having previously been 10%+ up until this hit.

There are at time of posting no corona cases in Norfolk (I know there probably are).  Once this happens officially I expect it to crater.  

So I now have a couple of weeks of this and then the shutdown will it be for a few weeks or a month anyhow it will cost me 20,000£ plus (not lost potential earnings just the cost of stasis).

Needless to say I have pulled out as I am keeping the house money close at hand if things do not get better for an extended period.

Who the hell is going to buy a house this year (unless a vaccine) unless they are getting a bargain?

Over the next few weeks I expect auctions to be cancelled, jobs to be lost and a lot of people to die.

If you have to sell you are going to have a hard time getting someone to view it.

Crash over 20% probably no but I would want 20% off to buy right now with all this over my head.



 

 

Will certainly be interesting seeing if many of the recently ‘Under Offer’ homes return to For Sale. Not seeing it just yet where we’re (were) looking. 

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i am really really glad i don't need to be making a decision on buying a house right now.

it could be an absolutely excellent time to get a good deal with the disruption, it could be a once in a lifetime blip.

or it could be the start of a huge long overdue recession. 

imagine paying rent right now, and having to make the decision to go through with a deal or not.

there are right and wrong answers, BUT NO ONE KNOWS WHICH IT IS! 

godspeed i guess, and good luck with whatever you choose. 
 

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2 minutes ago, jiltedjen said:

i am really really glad i don't need to be making a decision on buying a house right now.

it could be an absolutely excellent time to get a good deal with the disruption, it could be a once in a lifetime blip.

or it could be the start of a huge long overdue recession. 

imagine paying rent right now, and having to make the decision to go through with a deal or not.

there are right and wrong answers, BUT NO ONE KNOWS WHICH IT IS! 

godspeed i guess, and good luck with whatever you choose. 
 

That’s the exact position we’re in. Desperate to buy but with first Brexit then this there’s just never been the right time or right House. Happy I’m in cash but nervous about the risks with that too.

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