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I am calling the top - its turned


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Well the post-lockdown bubble has also ended in Canada - both sales  and listings now down about 50% month-on-month.

Spain where i was on the Costa Blanca area you can easily pick up a 2/1 furnished app for 60 k they were 80k pre Covid

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We'll know more by the end of the year but if prices aren't showing 5% falls by April its time to pack up and leave, i told as much to my in laws today, this shocked them, they'll not see their grandkids. Still they can be happy with their house price shooting up like an Edinburgh junkie. 

Didn't you move to France once already?

Just seen Pebbles - you must've comer back. Portugal is cheap. IoW is good value and nice SE climate and wonderful if you like beaches and boats. 

Tonnes of half demented olduns that still think they're capable of driving though so watch yourself if you cycle. 

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I have to admit, I knew that when the credit crunch happened, govt responses to it would entail massive money printing and precipitously dropped interest rates. We knew this because that's what they'd said they'd do in previous discussions of possible financial crises before it happened. 

I don't feel this way for this one. I don't think govts or central banks have the ammunition to deal with this one. But I may be wrong.

I got a lifetime tracker in 2008 because I thought that the economy would need low interest rates for a long time.

I didn't think it would be as low and long as it turned out though.

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Wait. 

One of the structural imbalances in the housing market is there are too many small dwellings - flats, small modern houses and not enough big family homes. Demand for the latter being more resilient. There are many reasons why demand for flats are more at risk. Buy to let sellers, people not as willing to pay for small units anymore, unemployed from Covid fallout more likely to hit the bottom/middle of the market etc. 

In this instance 5h1t flows uphill, or up the ladder. With the banks now demanding 20+% deposits and only lending 4X income, unless owners have been very good at saving, or paid off a big chunk of the mortgage on a flat, they will not be able to finance the jump to the bigger house. People currently living in 900 sq m flats in Brixton that they bought 3 years ago for 350k and think are now worth 500k, and so can buy their 4 bed in the country, are in for a very rude awakening. The crash in London, and the impending crash in slave box flats will go all the way up the ladder. It may take time as people in 4 bed detached houses for the most won’t be forced sellers, but if they are...I am waiting.

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I agree - it's turned in the last few days - people aren't very bright generally when it comes to systemic analysis - there are so many levels of unravelling going on here - from international trade/integration through to job losses... hugely complex... the result if people seem to imagine it's the same as any previous financial crisis. 

It isn't - it's more complex... and with that complexity comes huge risk... off the scale risk. 

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In this instance 5h1t flows uphill, or up the ladder. With the banks now demanding 20+% deposits and only lending 4X income, unless owners have been very good at saving, or paid off a big chunk of the mortgage on a flat, they will not be able to finance the jump to the bigger house. People currently living in 900 sq m flats in Brixton that they bought 3 years ago for 350k and think are now worth 500k, and so can buy their 4 bed in the country, are in for a very rude awakening. The crash in London, and the impending crash in slave box flats will go all the way up the ladder. It may take time as people in 4 bed detached houses for the most won’t be forced sellers, but if they are...I am waiting.

The people in the shires trying to sell their 200k Persimmon home for 500k to sone idiot from London also in for a shock!!! 

 

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Anecdotal, but I rarely check my Rightmove search area on a Monday because it is very infrequently updated on the first day of the week. Checked today - flurry of new reductions appeared this morning. Not reading too much into it, but encouraging.

Nationwide Sep numbers due out this week...

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I think the train is on the right track, but there is still some distance to go.

Has the penny dropped for London flat owners that prices are off the peak? I am genuinely not so sure as yet, EWS1 is something easy to blame and they may choose to believe that once it passes it'll be business as normal.

Once there are several articles about people losing their job and every penny to their name (because their 10% deposit was wiped out by a 10% fall) I think that will aid sentiment turning.

 

 

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I agree August/Sept 2020 is the top of this frothy market.

I've watched the market closely (open mouthed) for the last 12 months.  I own, with a small mortgage, but spend more time at my partners house.  Mine is on the market with a view to then selling hers and buying one together.  The price bracket we would be looking at for a joint purchase is way higher than I ever expected to be looking at yet the houses that have been available in that price bracket that have looked desirable have come on the market and gone in no time.  Plenty of properties have stuck but they are blatantly over priced (not just 2020 overpriced but people asking maybe 10 or 15% over what even the current market values are). 

Mine went on the market (at admittedly 5% over what I thought was achievable!) and there was massive initial interest but even after a price drop (to a price point in line with what others sold for in August) there is now no interest.  I'm not too concerned as I don't want the equity cash in the bank at present and not selling mine just stops me being persuaded to throw more money into an over priced market.

I think first time buyers or buy to let investors are at the base of most chains and the former are being hindered (rightly) by deposit requirements and the latter only would need to think long and hard about more BTL properties at this time, so house sales will eventually slow down dramatically (if that hasn't already happened).  Property prices will not come down quickly, they don't behave like stock markets & like an oil tanker property prices take a while to change direction, yet change I feel they will.  

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It is a pain Sunak did his SD thing, if he hadn't I think we would now be already a few more percent down from June. On the other hand, if sales do drop, as we are observing, and the shires have seen their day, and London continues to go down, we could see some very sharp falls at the back end of this year early next year...like all of July and August evaporating in November alone.

Either way, in Sussex things have changed hugely in the last few weeks.

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Went to see what is almost my "carry me out in a coffin" home - 4.5 bed detached in leafy home counties. In the precise location I want.  

They had 20+ viewings over the weekend. 

My offer, rejected, -12% from asking was the only one. 

Us and 3 other interested parties going for a second look.

In Feb that was 10 offers and sealed bids today - no question. 

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It is a pain Sunak did his SD thing, if he hadn't I think we would now be already a few more percent down from June. On the other hand, if sales do drop, as we are observing, and the shires have seen their day, and London continues to go down, we could see some very sharp falls at the back end of this year early next year...like all of July and August evaporating in November alone.

Either way, in Sussex things have changed hugely in the last few weeks.

I reckon he hoped it would all be over by now (CV19 I mean) but it aint and now they're having to reign the spending in and the taxes will have to rise.  People are expecting an extension of the stamp duty cut, I'm not, I'm expecting a rise in all taxes, SD included.

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Anecdotal, but I rarely check my Rightmove search area on a Monday because it is very infrequently updated on the first day of the week. Checked today - flurry of new reductions appeared this morning. Not reading too much into it, but encouraging.

Nationwide Sep numbers due out this week...

Snap. I checked W London Rightmove today and saw quite a few reductions. One was £50K on a place that came on for £550 only 3 weeks ago (still overpriced with the reduction obviously!). This is similar to what was happening back in May and June.

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Well the post-lockdown bubble has also ended in Canada - both sales  and listings now down about 50% month-on-month.

Glad to hear it. I used to live in Barrie, and the Realtor who sold our house had been gloating in August on facebook how houses are the new toilet paper...she may need some now to wipe away her tears if you are right. I actually really liked her though, she only charged us 1%, and the buyer was a realtor who waved their fee...happy days, paid the same as we pay here in the UK.

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Glad to hear it. I used to live in Barrie, and the Realtor who sold our house had been gloating in August on facebook how houses are the new toilet paper...she may need some now to wipe away her tears if you are right. I actually really liked her though, she only charged us 1%, and the buyer was a realtor who waved their fee...happy days, paid the same as we pay here in the UK.

Down the pan and round the u-bend?

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just seems to me based on antidotes on here, that the picture is London and surrounding areas down, places people would like to live up.

pretty horrific if you wanted to have a humble life in a nice area and suddenly a flood of londers ruin it. 

Just at what point does the money tap stop, if london is down it wont take too long for negative equity to halt the flood of monies.  

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There is a BBC news story about people who can’t buy because of the increased deposit requirements, hard to believe people can’t find 15% but there you go, just shows the whole UK market is a Ponzi scheme 

To be fair 15% is quite difficult to get hold of depending on circumstances. If your renting and trying to save for a deposit, its not easy.

I've definitely noticed reductions though in London.

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Wrong stories, IMO.

I want to see stories about people who took out a high LTV mortgage and ended up losing all their deposit and still owing the bank money because house prices have fallen. 

The longer this goes on, the more likely it'll be the case.

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  • 441 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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