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Do you genuinely believe we will see a HPC now ?


Do you genuinely believe we will see a HPC now ?  

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  1. 1. Do you genuinely believe we will see a HPC now ?

    • Yes
      109
    • No
      49


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I've been watching the house price madness since 2000. 

Every year I've thought, this cant go on and indeed, in 2007, it stopped, more paused really.

Since then they, the government, have thrown billions at the housing market to re-inflate their bubble.  

They use phrases like "recovery" and "return to 2007 prices" while telling everyone they are serious about bring down the cost of shelter.

They say they'll stop the immigration every year, but still a small city worth of people flood in annually.

The bankers have/are being handed magicked up cash to lend out at practically 0%.

They coerce people to invest in bubbles by making saving untenable.

I know it looks pretty good right now for a sizable fall in prices but they've already got their ducks in a row, more term funding, more support for builder, lower interest rates, talk of negative rates.

Does anyone hand on heart see a large nominal fall in house prices being allowed to happen ?

They are handing out money like sweeties.  Have a look around various forums and you'll see people reveling in all the free cash they are getting.

They've propped up the stock market, can they do the same with the housing bubble ?

I hope they can't but after 20 years of watching this madness I think they can, or at least they will throw everything at trying to.

The MSM are already pumping out the propaganda, "you can ask for 20% off but you might get 5%".

Just look who they allowed back to work first, f****g second hand house salesmen, i'd wager many of they are still collecting their furlough money.

Unless the establishment want a crash right now, I dont think it's going to happen.  I just hope for all our sakes I am wrong.

 

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My prediction is about 20% down this year but regionally varied, I think London and cities pumped up by Airbnb or other tourism influences will be hit by 30% or so but other cities and rural areas that haven’t been inflated as much in the last 10 years maybe only see modest decreases. 
 

However, what I do think is that there will be limited growth over the next 5 years as buyers will be cautious and not outbidding like they have in the past and other market stimulus such as low interest rates and government schemes have now been used and no longer available. Against inflation I think there will be modest nominal house price deflation. 

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3 minutes ago, Ghostly said:

Once bitten, twice shy when it comes to predictions. By rights there should be one with 10%+ unemployment, businesses folding, job insecurity. However, the government is touting ideas like 30% discounts on new builds for FTBs so who knows.

It seems ‘the economy’ is housing so it’s unlikely the government will let it fall / reduce in size.

"the government is touting ideas like 30% discounts on new builds"

There in lies the problem.  The self proclaimed free market tories are going to offer 30% discounts by paying the 30% to companies that found thier f**king election campaign.  This is corruption/fraud.  We all know the correct solution to making prices lower, they know it too, but they refuse to do it.  It's not difficult to see that they will try and keep nominal prices up while the whole country is falling apart. 

I'm confident of 1 prediction that I have been saying on here for years, house prices are the least of your worries, the country will collapse before these "men"  are stopped. 

At which point, they'll hold all the assets and all the tanks.

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1 minute ago, Rian1988 said:

My prediction is about 20% down this year but regionally varied, I think London and cities pumped up by Airbnb or other tourism influences will be hit by 30% or so but other cities and rural areas that haven’t been inflated as much in the last 10 years maybe only see modest decreases. 
 

However, what I do think is that there will be limited growth over the next 5 years as buyers will be cautious and not outbidding like they have in the past and other market stimulus such as low interest rates and government schemes have now been used and no longer available. Against inflation I think there will be modest nominal house price deflation. 

I hope you are right.  Hell maybe they want a crash so they can all profit even more.  Who knows.

I'm just basing my statements on the despair of the last 20 years.

What is clear to me is that the UK is heading for disaster and the establishment need to be taken down a peg or 10

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YES it's going to happen. I'm a new member (previous lurker) you might value someo of the old timers opinions a bit more.

They will continue to try and prop it up but hey will fail.

 

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The whole economy is screwed. I'm going with 20% reduction this year in the entire south area.

Tories need to be very careful with any policies propping up ftb or house prices because surely young people have now woken up to how the housing market is essentially a ponzi scheme, how they've been loaded with university debts, lower prospects of jobs, etc...

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I read back about the great depression and the world just doesn't seem to be the same place anymore. That was a time when everyone was poor once the depression hit, literally no one could pull out a large note and pay for anything. 

Our society (and the world largely) seems to be a 2 or 3 tier system. Not a 'class' system as such but there are pensioners with final salary pension which adjust for inflation who will never be poor, there are millions who own their own home, have decent jobs, some cash saved who might do well, might do OK or might fall on hard times, and there's a large number of people in I secure work and accommodation whose lives could drop into an abyss in a few days. 

It feels like that gulf is going to rip open further between people who work at the same employer, live in the same street, do the same jobs, were born in the same year etc. I'm not sure that will mean a house price crash.... It could mean the same market going on much longer but with even lower volumes. 

Edited by regprentice
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4 minutes ago, TheCountOfNowhere said:

"the government is touting ideas like 30% discounts on new builds"

I don't think this will make much of a difference, and certainly not as big an impact as help to buy

The key part is the `discount baked in for future purchasers` This sounds like shared ownership with no rent due on the remaining share but without the option of staircasing. It'll also likely mean that the next purchaser will have to meet the same criteria to purchase from the original owner, thereby limiting the uplift and pool of buyers.    

The scheme sounds suspiciously like Discount Market Sale, that certain councils were pushing in favour of shared ownership. https://www.samconveyancing.co.uk/news/conveyancing/discount-market-sale-dms-a-path-to-low-cost-home-ownership-8228

With DMS, the developer of a swanky new block offered the worst flats in the development (windows onto the shared bins, etc) to purchase by lower income residents as condition for planning permission. The council retained a share in these flats and had first dibs at resale to other residents on a resale. 

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Yep. I never thought I'd say it, but it's on this time. 

I wouldn't like to predict the % falls, or the speed of those falls, and it will vary in different parts of the country, and across different property types, but it is very much going to happen this time.

By the time this is has played out, everyone will know someone who's lost out big time, tales of woe that will depress the appetite for taking on debt for many years to come.

 

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4 minutes ago, sammersmith said:

I don't think this will make much of a difference, and certainly not as big an impact as help to buy

The key part is the `discount baked in for future purchasers` This sounds like shared ownership with no rent due on the remaining share but without the option of staircasing. It'll also likely mean that the next purchaser will have to meet the same criteria to purchase from the original owner, thereby limiting the uplift and pool of buyers.    

The scheme sounds suspiciously like Discount Market Sale, that certain councils were pushing in favour of shared ownership. https://www.samconveyancing.co.uk/news/conveyancing/discount-market-sale-dms-a-path-to-low-cost-home-ownership-8228

With DMS, the developer of a swanky new block offered the worst flats in the development (windows onto the shared bins, etc) to purchase by lower income residents as condition for planning permission. The council retained a share in these flats and had first dibs at resale to other residents on a resale. 

Whole house too expensive for you ? How about half... or a quarter?

The HMO-isation of the housing stock has been a mainspring of Tory housing policy since 2010, but it must surely be exhausted now. A combination of Covid recession and Brexit driving away the vast population of uncomplaining rent mules necessary to make it work. And also the cost: an additional £400bn of borrowing every parliament. No, affordability has to be restored. Prices must be allowed to correct.

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Does anyone know if HPI correlates with GDP growth and if so by how much? Most estimates are saying GDP could collapse by 30% this year (ouch) so I;m wondering if there is any link between the two.

Edited by Warlord
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6 minutes ago, regprentice said:

I read back about the great depression and the world just doesn't seem to be the same place anymore. That was a time when everyone was poor once the depression hit, literally no one could pull out a large note and pay for anything. 

Our society (and the world largely) seems to be a 2 or 3 tier system. Not a 'class' system as such but there are pensioners with final salary pension which adjust for inflation who will never be poor, there are millions who own their own home, have decent jobs, some cash saved who might do well, might do OK or might fall on hard times, and there's a large number of people in I secure work and accommodation whose lives could drop into an abyss in a few days. 

It feels like that gulf is going to rip open further between people who work at the same employer, live in the same street, do the same jobs, were born in the same year etc. I'm not sure that will mean a house price crash.... It could mean the same market going on much longer but with even lower volumes. 

Yes. I agree it is a kind of class system, a "Covid cast system" perhaps?

One set of people are largely unaffected financially:

  • Pensioners are insulated (again), but are scared of getting infected. They're fine unless or until inflation picks up, then they'll be screwed.
  • Middle class professionals WFH - often on full salaries - saving on travel costs and the cost of holidays and eating out.
  • Key workers like nurses and bin men are working full time and getting paid as normal.

But there's a massive rump of people who are in trouble:

  • Furloughed professionals who are going to be made redundant as soon as the government scheme is wound up, there'll be millions of them.
  • Small business owners who will have no business when this is over.
  • Low paid gig economy workers in the hospitality and tourism industries.

The sheer number of people who are going to find their whole industry no longer exists is going be huge. There will be forced sales of personal assets. Houses and cars. Along with a load of assets from company wind-ups. I've got my eye on a Tesla Model S for my next car - I'm sure they'll be a load of those being handed back in the next year or so. It doesn't need everyone to be in trouble to cause a glut of supply. And it's coming. It's probably 12-18 months out, but it's coming big time.

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31 minutes ago, Bluestone59 said:

Why didn't Major try to pull some stunt with the property markets? If anything things are looking worse now than in 1992, depending on what happens when the furlough and/or the customers run out.

Major and Clarke went a different way and wanted to eliminate the deficit They left Blair a budget surplus and an economy growing at 3.5% per annum!.

They all felt badly stung after the ERM disaster for any big state intervention. Now however the current crop of politicians don't think twice at throwing money around. Interestingly Ken Clarke said the other day that the current Chancellor is doing is lunacy and he sounded very bearish (like me) on the currency, debt and deficits. 

 

Edited by Warlord
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4 minutes ago, Warlord said:

Does anyone know if HPI correlates with GDP growth and if so by how much? Most estimates are saying GDP could collapse by 30% this year (ouch) so I;m wondering if there is any link between the two.

House prices are closely tied to affordability which is a mix of steady income and the cost of debt.

The cost of debt is near zero - even cost of saving (negative interest rates) rears its head.

I suspect much of this is about how unemployment jumps (or not).

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3 minutes ago, Bear Goggles said:

The sheer number of people who are going to find their whole industry no longer exists is going be huge. There will be forced sales of personal assets. Houses and cars. Along with a load of assets from company wind-ups. I've got my eye on a Tesla Model S for my next car - I'm sure they'll be a load of those being handed back in the next year or so. It doesn't need everyone to be in trouble to cause a glut of supply. And it's coming. It's probably 12-18 months out, but it's coming big time.

The government doesn't want hundreds of thousands of people suddenly needing housing or housing benefit, and would rather concoct some mortgage payment relief scheme to keep people in their homes, even if it's the government basically buying taking some of the equity itself.  It's just so much less hassle to pay people to stay in their homes than re-home them.

Not to say house prices won't fall, since the demand for them will be lower.  But I don't think you will see forced sales in giant numbers.

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1 minute ago, Warlord said:

and he sounded very bearish (like me) on the currency, debt and deficits. 

And it seems to me sensible to worry about currency risk when sloshing money around at unprecedented speed.

But when the other currencies are sloshing money around as fast (or faster) then local currency risk is lower, surely?

If all the children on the playground are stealing each other's lunch, the probability of getting caught stealing your classmates lunch is much smaller. As long as you aren't the one caught and punished when the fashion for stealing lunches ends ... like the last person into a Ponzi scheme pays all the price.

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3 minutes ago, Warlord said:

Major and Clarke went a different way and wanted to eliminate the deficit They left Blair a budget surplus and an economy growing at 3.5% per annum!.

They all felt badly stung after the ERM disaster for any big state intervention. Now however the current crop of politicians don't think twice at throwing money around. Interestingly Ken Clarke said the other day that the current Chancellor is doing is lunacy and he sounded very bearish (like me) on the currency, debt and deficits. 

 

Yes, thanks, I saw Clarke had said that.

Back then he also said that property markets were screwed and couldn't justify an attempt to "save" them.

In which case why do today's mob think otherwise? Unless they believe today's situation is less bad.

 

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It would be a massive help when asking the question you put what are the personalities like who are giving you an answer. Straight away you are going to get replies from people who would of claimed there was a property crash on it's way since 2000 like yourself, that's also brave and honest of you by the way. Then there are those that are more considered, sometimes through bitter experience, and others just do not have a clue and are honest about it, some even want one so badly their posts sound more like a prayer than a reasoned argument, but I think the general consensus on here has always been to back an imminent property crash throughout the years, and most of the times it obviously never happened.

I have had my doubts about a housing market surviving for several years now, I have loved reading many of the posts on HPC in that time but was never compelled to join. Reasons being were what I had to say was being said and a big part of me realised that it could be years before something put a spanner in the works, I have always suspected that it was a black swan event that was needed. I have really worked on not letting the housing situation niggle me, built up a plan along with a nest egg and zero debt while having as much fun as I could, having my own home was always the downside in my life though to be honest, but I just had to be strong.

So around February there about's I started focusing on C-19 and by March I was as good as close to 100% certain that a property crash is now on. I did my homework as I watched my business lose work and customers(not an ounce of concern to date by the way), I have had my A4 pad out doing notes and calculations, I have read as many sources as I could, focusing also on the more historically bullish among them and the change in rhetoric is mind blowing.

So after all that waffle ? .. I am someone for several years now who was so cautious on making yearly predictions, but as from Mrch 2020 it is nearly impossible now to convince me a property crash will not happen

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7 minutes ago, Bear Goggles said:

Yes. I agree it is a kind of class system, a "Covid cast system" perhaps?

One set of people are largely unaffected financially:

  • Pensioners are insulated (again), but are scared of getting infected. They're fine unless or until inflation picks up, then they'll be screwed.
  • Middle class professionals WFH - often on full salaries - saving on travel costs and the cost of holidays and eating out.
  • Key workers like nurses and bin men are working full time and getting paid as normal.

But there's a massive rump of people who are in trouble:

  • Furloughed professionals who are going to be made redundant as soon as the government scheme is wound up, there'll be millions of them.
  • Small business owners who will have no business when this is over.
  • Low paid gig economy workers in the hospitality and tourism industries.

The sheer number of people who are going to find their whole industry no longer exists is going be huge. There will be forced sales of personal assets. Houses and cars. Along with a load of assets from company wind-ups. I've got my eye on a Tesla Model S for my next car - I'm sure they'll be a load of those being handed back in the next year or so. It doesn't need everyone to be in trouble to cause a glut of supply. And it's coming. It's probably 12-18 months out, but it's coming big time.

add to that stuff like field sales reps now having to do more remote and webinar work with potential customers,whan it traditionally would be face to face meetings, means quite a bit less in the way of fleet vehicles I think!

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1 minute ago, scottbeard said:

The government doesn't want hundreds of thousands of people suddenly needing housing or housing benefit, and would rather concoct some mortgage payment relief scheme to keep people in their homes, even if it's the government basically buying taking some of the equity itself.  It's just so much less hassle to pay people to stay in their homes than re-home them.

Not to say house prices won't fall, since the demand for them will be lower.  But I don't think you will see forced sales in giant numbers.

Of course there will be action take by govt. to mitigate repossessions and homelessness. But just like the furlough scheme, it will have upper limits and won't accommodate all scenarios, e.g.: What about Air BnBs? What about second homes? What about landlords who can't find tenants with enough money to cover their mortgages? What about empty new builds? There'll be enough gaps to cause a significant number of assets to come on the market. 

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  • 416 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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