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Will Corona virus cause a house price crash?


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On 02/01/2021 at 00:13, Warlord said:

Give it another 6 months they merely kicked the can.

Saw the latest Halifax figures on the other thread alongside the below, and thought of you @Warlord. Here we are now a year on from you laughing your head off at the 'stupidity' of me buying early 2020, crash baked in, no more props etc etc, and six months on from when you said the above about give it another six months. What has happened:

https://www.bbc.co.uk/news/business-57055314

"Prices are up 8.2% in the last 12 months, the highest annual growth rate for five years"

Whatever the reason, whatever the rights and wrongs of the situation, is it time to put your hand up and say you were wrong? For what it's worth, this kind of rise doesn't really sit well with me either for multiple reasons, and I think I've made my point now about the folly of making such certain statements about the future - you are far from alone on here...

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On 17/03/2020 at 10:17, TheCountOfNowhere said:

Have a look at the builders share prices, they've gone off a cliff.

 

Will there be a house price crash.  Bloody right there will be.

And here we have another prophecy from the count some 15 months ago. 

 

Yet...

"House prices reach record high for second month in a row in April"

 

"House prices were 8.2% higher than in April 2020"

https://www.halifax.co.uk/assets/pdf/april-2021-house-price-index.pdf

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3 hours ago, Twenty Something said:

Saw the latest Halifax figures on the other thread alongside the below, and thought of you @Warlord. Here we are now a year on from you laughing your head off at the 'stupidity' of me buying early 2020, crash baked in, no more props etc etc, and six months on from when you said the above about give it another six months. What has happened:

https://www.bbc.co.uk/news/business-57055314

"Prices are up 8.2% in the last 12 months, the highest annual growth rate for five years"

Whatever the reason, whatever the rights and wrongs of the situation, is it time to put your hand up and say you were wrong? For what it's worth, this kind of rise doesn't really sit well with me either for multiple reasons, and I think I've made my point now about the folly of making such certain statements about the future - you are far from alone on here...

Wait 6 months after its ended. They have extended it until Sept and kicked the can like I said.  Once the can cannot be kicked further then we'll see some action! 

 

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On 3/12/2020 at 8:13 AM, cbathpc said:

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

Spot on. 

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1 hour ago, Warlord said:

Wait 6 months after its ended. They have extended it until Sept and kicked the can like I said.  Once the can cannot be kicked further then we'll see some action! 

 

You and @TheCountOfNowhere need to put your hands up and admit to got it disastrously wrong. I honestly hope you guys ain’t renting because your now even more priced out than before. 

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1 minute ago, MonsieurCopperCrutch said:

You and @TheCountOfNowhere need to put your hands up and admit to got it disastrously wrong. I honestly hope you guys ain’t renting because your now even more priced out than before. 

I'm a happy renter thank you.  It suits me 

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1 minute ago, MonsieurCopperCrutch said:

If you’re happy then that’s all that matters. But you’ve got to admit it that you got it disastrously wrong nonetheless. 

Furlough hasn't ended yet. We're still in "stasis". Wait until it ends if it ever does,

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5 hours ago, MonsieurCopperCrutch said:

If you’re happy then that’s all that matters. But you’ve got to admit it that you got it disastrously wrong nonetheless. 

Sarah O’Connor was right about the end of the world....but she didn’t go round kicking the graves of the dead telling them they were wrong.

This site is about the wrongs and wrongs of high house prices and an understanding that prices might rise against all the odds but only because of a concerted effort by governments across the world pushing up asset prices.

No-one really knows what will happen tomorrow.

I am more heavily invested in property than most people and I am crying out of a decent crash. I want prices to fall and believe a correction will come but I might be wrong.

However, I won’t celebrate a 10% rise this year (if that happens) by pushing it in the faces of ‘Bears’ on this thread but rather shake my head with them at my disappointment of the suffering it is causing so many.

I have seen some awful houses sell at really high prices last summer. Starting to see it again last month.

It is still possible to buy ‘fairly well’ but sentiment is so high people are jumping in carelessly with a recent sale at £320k for a half extended semi ie dining extension only (immaculately presented) but small gardens....when in December the better one opposite agreed and completed for £235k. Market values (without a crash....just a removal of ‘buying fever’) I estimate around £225k.

My son agreed a ‘half decent’ purchase in December and completed last month. With some steering from me and building in an expectation of falls in the future he has done ‘okay’. Others are believing the hype with genuine examples at this price point of paying 50% too much. 

So a dose of sensible ‘bearish’ talk is welcomed on this thread because I know even without a fall in prices some people have already lost out once the sentiment cools down. 

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45 minutes ago, Pop321 said:

Sarah O’Connor was right about the end of the world....but she didn’t go round kicking the graves of the dead telling them they were wrong.

This site is about the wrongs and wrongs of high house prices and an understanding that prices might rise against all the odds but only because of a concerted effort by governments across the world pushing up asset prices.

No-one really knows what will happen tomorrow.

I am more heavily invested in property than most people and I am crying out of a decent crash. I want prices to fall and believe a correction will come but I might be wrong.

However, I won’t celebrate a 10% rise this year (if that happens) by pushing it in the faces of ‘Bears’ on this thread but rather shake my head with them at my disappointment of the suffering it is causing so many.

I have seen some awful houses sell at really high prices last summer. Starting to see it again last month.

It is still possible to buy ‘fairly well’ but sentiment is so high people are jumping in carelessly with a recent sale at £320k for a half extended semi ie dining extension only (immaculately presented) but small gardens....when in December the better one opposite agreed and completed for £235k. Market values (without a crash....just a removal of ‘buying fever’) I estimate around £225k.

My son agreed a ‘half decent’ purchase in December and completed last month. With some steering from me and building in an expectation of falls in the future he has done ‘okay’. Others are believing the hype with genuine examples at this price point of paying 50% too much. 

So a dose of sensible ‘bearish’ talk is welcomed on this thread because I know even without a fall in prices some people have already lost out once the sentiment cools down. 

Where was I celebrating 10% rises buy pushing it in the faces of the bears? I’m telling them that they need to be realistic and an important part of realism is the ability to admit to your peers that you called it wrong. Repeatedly. A stopped clock is eventually correct but that doesn’t mean it’s right nor helpful to keep posting biased unfounded hyperbole. That helps no one and is a sign of an unthinking mind lacking critical analysis. 
 

P.S. I’m looking to purchase another property yet you think I want to pay an extra 10% just to push it in some random strangers faces. Hilarious. 

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54 minutes ago, Pop321 said:

Sarah O’Connor was right about the end of the world....but she didn’t go round kicking the graves of the dead telling them they were wrong.

This site is about the wrongs and wrongs of high house prices and an understanding that prices might rise against all the odds but only because of a concerted effort by governments across the world pushing up asset prices.

No-one really knows what will happen tomorrow.

I am more heavily invested in property than most people and I am crying out of a decent crash. I want prices to fall and believe a correction will come but I might be wrong.

However, I won’t celebrate a 10% rise this year (if that happens) by pushing it in the faces of ‘Bears’ on this thread but rather shake my head with them at my disappointment of the suffering it is causing so many.

I have seen some awful houses sell at really high prices last summer. Starting to see it again last month.

It is still possible to buy ‘fairly well’ but sentiment is so high people are jumping in carelessly with a recent sale at £320k for a half extended semi ie dining extension only (immaculately presented) but small gardens....when in December the better one opposite agreed and completed for £235k. Market values (without a crash....just a removal of ‘buying fever’) I estimate around £225k.

My son agreed a ‘half decent’ purchase in December and completed last month. With some steering from me and building in an expectation of falls in the future he has done ‘okay’. Others are believing the hype with genuine examples at this price point of paying 50% too much. 

So a dose of sensible ‘bearish’ talk is welcomed on this thread because I know even without a fall in prices some people have already lost out once the sentiment cools down. 

But this isn’t about rubbing it in the face of all, and as I said, I’m not jumping around for joy and the price rises recently concern me too. What it is about is calling out a few of the regulars on here who are quite frankly pretty nasty about their assertions. People like the count and warlord who throw around insults that add nothing to the debate, and whom in all honesty I have no qualms about pointing out how repeatedly wrong they are. 
 

As you say, sensible bear (and bull) talk is all good. Don’t go getting all moral with me however about giving a little back to people who have thrown insults around, and who deserve therefore to be reminded of just how wrong they have been. 

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5 minutes ago, MonsieurCopperCrutch said:

Where was I celebrating 10% rises buy pushing it in the faces of the bears? I’m telling them that they need to be realistic and an important part of realism is the ability to admit to your peers that you called it wrong. Repeatedly. A stopped clock is eventually correct but that doesn’t mean it’s right nor helpful to keep posting biased unfounded hyperbole. That helps no one and is a sign of an unthinking mind lacking critical analysis. 
 

P.S. I’m looking to purchase another property yet you think I want to pay an extra 10% just to push it in some random strangers faces. Hilarious. 

Couldn’t agree more as per my reply. Even when faced with concrete evidence that he is wrong, @Warlord amongst others can’t put their hands up and just say yup, I called it wrong. In the past year, prices have done the exact opposite and some to what he stated as fact would happen, yet the only response is ah well just you wait and see what happens in six months time. Again. 

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On 16/01/2021 at 09:07, Pop321 said:

That works if you are ‘fishing’ and can do it in 20 properties because one may ring back after a few weeks....much harder if you are looking for a home. Even almost impossible if you find your ideal home 😉

That was us last year. A property popped up that matched almost everything we wanted. The area was always of interest to us but we were ideally looking closer in because of the commute. With remote working and stamp duty "saving" we decided to take a chance and we pushed to move very quickly. We said we'd be no nonsense buyers, very committed (explained family situation) and offered 5% (+-) below asking. One back and forth round then offer accepted and completed in about two months. Did we overpay? We'll never know but we don't care because we love the house and feel it was worth it.

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30 minutes ago, Twenty Something said:

Couldn’t agree more as per my reply. Even when faced with concrete evidence that he is wrong, @Warlord amongst others can’t put their hands up and just say yup, I called it wrong. In the past year, prices have done the exact opposite and some to what he stated as fact would happen, yet the only response is ah well just you wait and see what happens in six months time. Again. 

Indeed. There’s nothing actually bad about being wrong. We are all wrong at times. What’s bad is when overwhelmingly presented with facts and figures against ones opinion that that person stubbornly refuses to acknowledge and change their mindset. 

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7 hours ago, Warlord said:

I'm a happy renter thank you.  It suits me 

In which case why do you keep on whinging about property prices which you perceive as being too high ! 

38 minutes ago, dugsbody said:

Did we overpay? We'll never know but we don't care because we love the house and feel it was worth it.

Exactly it is your home not an investment 

45 minutes ago, Twenty Something said:

What it is about is calling out a few of the regulars on here who are quite frankly pretty nasty about their assertions. People like the count and warlord who throw around insults that add nothing to the debate

Agree totally

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4 hours ago, dugsbody said:

That was us last year. A property popped up that matched almost everything we wanted. The area was always of interest to us but we were ideally looking closer in because of the commute. With remote working and stamp duty "saving" we decided to take a chance and we pushed to move very quickly. We said we'd be no nonsense buyers, very committed (explained family situation) and offered 5% (+-) below asking. One back and forth round then offer accepted and completed in about two months. Did we overpay? We'll never know but we don't care because we love the house and feel it was worth it.

Indeed. And whilst it’s useful to always be cautious, sometimes somethings are just right for you. 

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I got it wrong. I can recall sharing links with friends and giving it the old “it’s happening!!!” patter.

Its clear prices have remained healthy due to a shift in the way many work. In 18 months I’ll of saved about 10k on my commute, places being shut (family days out) and a couple of foreign holidays. Many of my friends have capitalised massively on childcare savings as they WFH with the kids kicking about.

I’m tired of messaging friends links to properties with the old “this will never sell at that price”. Guess what... they sell... they all do!!!!

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12 minutes ago, Pmax2020 said:

prices have remained healthy

Hmmmmmm. I hope you're being sarcastic with that word, in the same way as I am sarcastic about the BBC using the phrase 'prices have improved'.

They have wound their necks in with this thankfully.

Oh, and in answer to the topic title. Yes, Coronavirus and Brexit and debt will cause a house price crash. Double digit falls next year, 20-30% the year after, maybe I'll chuck in one for luck as well with 20-30% the year after. Then I'll buy :)

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39 minutes ago, Pmax2020 said:

I got it wrong. I can recall sharing links with friends and giving it the old “it’s happening!!!” patter.

Its clear prices have remained healthy due to a shift in the way many work. In 18 months I’ll of saved about 10k on my commute, places being shut (family days out) and a couple of foreign holidays. Many of my friends have capitalised massively on childcare savings as they WFH with the kids kicking about.

I’m tired of messaging friends links to properties with the old “this will never sell at that price”. Guess what... they sell... they all do!!!!

I got it disastrously wrong too (and I'm not ashamed to admit it). 6 months ago I was saying wait until spring before buying but like you say people have saved massives amounts of fiat over the last year. Clearly the advice last year should have been buy now otherwise you'll be looking at a 20% increase next year.

Edited by MonsieurCopperCrutch
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Posted (edited)

Quite interesting to skim read the first few pages of this post, from those early naive days of Corona.

 

Who would have thought we would still be facing this problem over a year later?!

Edited by reddog
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Property isn’t priced like shares, prices are far from efficient and saying there has been (or that there will be) a 20% rise just doesn’t happen like that.

In summer 2020 and again right now we have froth. 2020 saw a surge in demand and November it was quiet....so we (well my son) bought and saved £20k off Feb 2020 prices and maybe £70k off some of the prices being paid in August whilst viewings were crazy.

So overall will prices drop or will they rise....who can say what mad tricks the government will pull out of their magic money printing hat.

What is important is not to get caught up in a frenzy and overpay for a house that just isn’t right and 15/20% over priced.

Like I said last summer there are ebbs and flows as well as significance variances in presentation of property and homes. This talk of ‘buy now, don’t wait’ needs cooling with some balance. My son waited and managed to save 5 years of working life....by waiting 3/4 months. 

If 4 offers and 10 viewings on a very ordinary or indeed less than ordinary house is happening near you.....then leave it for now. Stamp duty and furlough etc will cool the market and even without a ‘fall’ prices do drop when viewings slow.

All things being equal this feels like a bubble and we could see real falls from some prices paid. Whilst I think that is true I can’t predict it as a certainty. What I can say with some certainty is the rush to buy is exposing some people with some bad decisions. That doesn’t include EVERYONE who buys....rather is a general message to tone down the ‘buy now otherwise you will miss out’ messages. Ebb and flows. Don’t get caught out. 

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This site has definitely made me more bullish on property in general.

In regards to COVID, I always thought that with the end of furlough and government support schemes we would see some sort of correction (I was thinking around 10-15%) but with these schemes being extended and likely to be tapered off, I can't see any correction happening. 

I do expect insolvencies and unemployment to rise in the next 12-18 months but I now think this won't have much affect on the housing market (as counter-intuitive as this seems).

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37 minutes ago, Sprrite said:

This site has definitely made me more bullish on property in general.

In regards to COVID, I always thought that with the end of furlough and government support schemes we would see some sort of correction (I was thinking around 10-15%) but with these schemes being extended and likely to be tapered off, I can't see any correction happening. 

I do expect insolvencies and unemployment to rise in the next 12-18 months but I now think this won't have much affect on the housing market (as counter-intuitive as this seems).

This site initially confirmed my existing bias that houses were overpriced (this was from around 2005 onward when I went searching online to find out if my gut feeling was correct). 

I delayed buying when friends around me were doing so since 2004 onward using the 100%+ mortgages being given out. 

In hindsight, I should have bought, I would be retired or nearly retired by now, all else being equal. But who knows if all else would have been equal. Anyway, I did learn to start questioning my preconceived bias and started digging in more to understand why houses were expensive. I learned how credit drives prices and I also formed the view that secular interest rates were only headed one way in the modern developed world, toward zero. I also learned that the game is just completely rigged by governments in favour of the housing market.

Once I learned the game I was rigged, I wrote out a cash flow prediction spreadsheet, evaluated my assumptions and realised I should buy, so I did.

Waiting for the entire world to experience a huge property price crash so you can time the market perfectly to buy in at the right time is a fools game. 

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9 minutes ago, dugsbody said:

Once I learned the game I was rigged, I wrote out a cash flow prediction spreadsheet, evaluated my assumptions and realised I should buy, so I did.

Waiting for the entire world to experience a huge property price crash so you can time the market perfectly to buy in at the right time is a fools game. 

Agreed that people should do what is best in their individual circumstances.

However the main issue for people on this site is affordability and getting hold of the deposit whilst paying sky-high rents. I've been earning decent money since I graduated but only managed to save enough during the pandemic (after moving out of London) to now be in a position to buy.

If you don't have the right background and with the support of BOMAD, it becomes much more difficult to get on the property ladder.

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