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House Price Armageddon

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The 2006 housing market is set to be the most stable for many years, with the lowest level of price growth and smallest number of sales for over a decade.

Experts have rarely been so unanimous. Almost all say a soft landing has taken place, so the threat of a crash has been discounted, even by the most pessimistic consultancies.

Now most commentators say there will be modest growth this year: 4 per cent according to property website Rightmove; or 3 per cent (Nationwide); or 2.5 per cent (estate agent Knight Frank). Property consultancy Savills says there will be no overall change at all, although this will mask rises and falls of 5 per cent in the regions.

Most also say that with a temporary shortage of properties on sale during the autumn and winter - created by an unexpected surge of buyers in late 2005 - many areas of Britain will see short-term price rises in the first three months of this year before values fall back slightly when the traditional glut of homes come on sale in the spring.

With this stable but undramatic prognosis, key market characteristics will be:

1. Fewer people moving

'We expect slow house price growth and the relatively high costs of moving home to act as a further brake on transactions,' says Richard Donnell of property consultancy Hometrack. He expects up to 5 per cent fewer sales in 2006 than last year, which was itself about 10 per cent down on 2004.

2. A shortage of new homes

New house building remains stubbornly about 30,000 units below the numbers needed to match the growth in households as people live longer and live alone.

'Demand from new households has consistently outstripped supply. This has been a substantial factor in pushing average asking prices towards an all-time high,' says Miles Shipside of website Rightmove, which monitors asking prices.

3.Winners and losers

Jim Ward of Savills says prime areas of central London are the places to watch. He predicts above-average rises this year in Docklands, Notting Hill, the West End and Mayfair. These may seem irrelevant to many people who cannot afford the capital's prices, but they could herald the start of a new cycle of property appreciation across the country.

Liam Bailey at Knight Frank says places with regeneration schemes will also do better than average. He cites Weymouth in Dorset, where there will be infrastructure development ready for the 2012 Olympic sailing events, and Kent's Medway towns, where people will want to live ahead of dramatically improved train services to London in 2009.

4. Home Information Packs

HIPs become compulsory in mid-2007, although pilot schemes in some of Britain will start this summer.

The packs, to be prepared by sellers and costing £500 each, must include search and survey information. They will almost certainly not have any long-term effect on prices, but estate agents - who are generally fiercely opposed to the packs - will urge owners who are thinking of moving to save money by selling before Christmas.

5. Affordability

The market message this New Year is steady as she goes - although some estate agents still hope for an unexpected bounce.

'Every year since 1997 commentators, economists and analysts have consistently underestimated house-price growth,' says Neil Chegwidden, an economist at estate agency Cluttons. 'So 2006 could see a repeat, given the economic backdrop and emerging trends in consumer confidence.'

There is nothing wrong with the prospect of a dull year. After high price rises since the Millennium and a period of worry that the housing market would crash, a lengthy spell of consolidation and relative unexcitement may be just what the market needs.

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Increased confidence in the housing market looks set to boost prices in some areas of the country this year according to estate agents.

Figures from mortgage lender Alliance & Leicester show that the average house price has soared from £101,550 five years ago to £189,852 now – an 87% hike.

But market stagnation means prices across most of the UK have remained relatively flat in recent months.

There are indications that this will change in 2006, however, at least in some parts of the country.

Savills, an estate agent, believes that prime central London property – or homes in the capital worth £1 million plus – will experience the highest growth next year.

It is forecasting rises of 5% in this part of the market and expects less expensive properties in London and the south east to increase in value by 3%.

Knight Frank, another estate agent, is even more bullish. It expects prime London property prices to leap 7% next year and the value of the most expensive properties – those worth £3 million or more – to jump by 8% on average.

This is obviously good news for homeowners looking to sell in London , where it has been a buyer's market for the past year or so.

However, growth in London could spell gains in other regions in the longer term as price rises in the capital historically pave the way for similar movement elsewhere.

Other positives for homeowners include that, despite reporting 0% growth in October, the Halifax survey three-month annual rate of growth hit its highest level since May last month.

Fears of a property market crash have also receded, with most commentators predicting a soft landing at worst.

The latest quarterly figures from the Land Registry indicate that recent house price inflation in Wales has left the rest of Britain standing. Average property values in Blaenau Gwent and Merthyr Tydfil rose 27.98% and 27.75% compared to the third quarter last year.

One thing the commentators generally agree on is that confidence in the housing market is improving.

A recent survey by Propertyfinder, a website, revealed that 54% of househunters - rising to 61% in London and the south east - expect property prices to increase over the next 12 months.

This should help to create a more dynamic market as confident buyers feel more comfortable stretching themselves and are less likely to postpone putting in an offer in the hope that prices will dive.

The real losers are the STRs and FTBs who are delaying buying a property as they patiently wait for a crash that will cause house prices to drop but many of them have found that house prices increased rather than fell while they were waiting for the right time to enter the market.

Estate agents' books illustrate that all-important first-time buyers – who stimulate movement further up the chain as well as on the lower rungs of the ladder – are already returning to the market in volumes not seen for many months.

Figures from the Inland Revenue show that the number of residential property transactions grew by 16% between the second and third quarters of this year.

And Bank of England statistics reveal that the number of mortgage approvals agreed to fund house purchases increased.

The reasons for this renewed enthusiasm include better employment figures and the Bank of England's decision to cut the base rate – to which most mortgage interest rates are linked – to 4.5% in August.

Many economists believe the BoE could drop rates again next year, leading estate agents such as Knight Frank to predict that the recent flurry of activity will continue into 2006.

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The 2006 housing market is set to be the most stable for many years, with the lowest level of price growth and smallest number of sales for over a decade. Blah Blah Blah...

Sh1t, look out it's Bill Gates!

Awooga???

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Many of the house price crash related predictions over the last six months have not come true. The house price crash predictions have just not happened. I would say that a property crash is unlikely to occur in the next five years.

Home owners in general are very unwilling to drop their price and this fact has been severely underestimated. I have looked at a few properties recently and all of them uttered those immortal words 'and house prices only go up you know'.

At the moment I do not see any events in 2006 that will make the housing market crash. There will be some negative economic news but this will not affect most people and will not bring on a house price crash.

The housing market lives or dies by the level of interest rates, unless there is some sort of genuine shock to the economy. I would predict house prices rising by between 5 and 10 percent this year.

The economic growth figures will be poor, unemployment and personal/business bankruptcies will rise, retail figures remain poor but none of the figures will be a disaster but they will be enough to make the Bank of England react with interest rate cuts. I would expect interest rates to be below 4% before the year is out.

Despite the increases in commodity prices inflation will remain low allowing the Bank of England to cut interest rates.

A lot has been written as to housing being unaffordable but I don't think this is the case yet. People in general are taking in all the positve news about property in the media and will do anything to get on the ladder. They will take on interest only mortgages with a view to paying money off it later, they will lie about their income, they will get big deposits from mum and dad, rooms can be rented out, they will part buy with the Government or the builder, couples of course have a double income and there may well be many other creative ways of getting on the ladder.

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The 2006 housing market is set to be the most stable for many years, with the lowest level of price growth and smallest number of sales for over a decade.

Experts have rarely been so unanimous. Almost all say a soft landing has taken place, so the threat of a crash has been discounted, even by the most pessimistic consultancies.

Now most commentators say there will be modest growth this year: 4 per cent according to property website Rightmove; or 3 per cent (Nationwide); or 2.5 per cent (estate agent Knight Frank). Property consultancy Savills says there will be no overall change at all, although this will mask rises and falls of 5 per cent in the regions.

Most also say that with a temporary shortage of properties on sale during the autumn and winter - created by an unexpected surge of buyers in late 2005 - many areas of Britain will see short-term price rises in the first three months of this year before values fall back slightly when the traditional glut of homes come on sale in the spring.

With this stable but undramatic prognosis, key market characteristics will be:

1. Fewer people moving

'We expect slow house price growth and the relatively high costs of moving home to act as a further brake on transactions,' says Richard Donnell of property consultancy Hometrack. He expects up to 5 per cent fewer sales in 2006 than last year, which was itself about 10 per cent down on 2004.

2. A shortage of new homes

New house building remains stubbornly about 30,000 units below the numbers needed to match the growth in households as people live longer and live alone.

'Demand from new households has consistently outstripped supply. This has been a substantial factor in pushing average asking prices towards an all-time high,' says Miles Shipside of website Rightmove, which monitors asking prices.

3.Winners and losers

Jim Ward of Savills says prime areas of central London are the places to watch. He predicts above-average rises this year in Docklands, Notting Hill, the West End and Mayfair. These may seem irrelevant to many people who cannot afford the capital's prices, but they could herald the start of a new cycle of property appreciation across the country.

Liam Bailey at Knight Frank says places with regeneration schemes will also do better than average. He cites Weymouth in Dorset, where there will be infrastructure development ready for the 2012 Olympic sailing events, and Kent's Medway towns, where people will want to live ahead of dramatically improved train services to London in 2009.

4. Home Information Packs

HIPs become compulsory in mid-2007, although pilot schemes in some of Britain will start this summer.

The packs, to be prepared by sellers and costing £500 each, must include search and survey information. They will almost certainly not have any long-term effect on prices, but estate agents - who are generally fiercely opposed to the packs - will urge owners who are thinking of moving to save money by selling before Christmas.

5. Affordability

The market message this New Year is steady as she goes - although some estate agents still hope for an unexpected bounce.

'Every year since 1997 commentators, economists and analysts have consistently underestimated house-price growth,' says Neil Chegwidden, an economist at estate agency Cluttons. 'So 2006 could see a repeat, given the economic backdrop and emerging trends in consumer confidence.'

There is nothing wrong with the prospect of a dull year. After high price rises since the Millennium and a period of worry that the housing market would crash, a lengthy spell of consolidation and relative unexcitement may be just what the market needs.

wow - you learnt how to cut and paste ! :unsure:

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Sh1t, look out it's Bill Gates!

Awooga???

Is it me or does the House Price Armageddon contribution sound like some sort of Government briefing note to keep the sheeple subdued?

JD :ph34r:

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Increased confidence in the housing market looks set to boost prices in some areas of the country this year according to estate agents.

Figures from mortgage lender Alliance & Leicester show that the average house price has soared from £101,550 five years ago to £189,852 now – an 87% hike.

But market stagnation means prices across most of the UK have remained relatively flat in recent months.

There are indications that this will change in 2006, however, at least in some parts of the country.

Savills, an estate agent, believes that prime central London property – or homes in the capital worth £1 million plus – will experience the highest growth next year.

It is forecasting rises of 5% in this part of the market and expects less expensive properties in London and the south east to increase in value by 3%.

Knight Frank, another estate agent, is even more bullish. It expects prime London property prices to leap 7% next year and the value of the most expensive properties – those worth £3 million or more – to jump by 8% on average.

This is obviously good news for homeowners looking to sell in London , where it has been a buyer's market for the past year or so.

However, growth in London could spell gains in other regions in the longer term as price rises in the capital historically pave the way for similar movement elsewhere.

Other positives for homeowners include that, despite reporting 0% growth in October, the Halifax survey three-month annual rate of growth hit its highest level since May last month.

Fears of a property market crash have also receded, with most commentators predicting a soft landing at worst.

The latest quarterly figures from the Land Registry indicate that recent house price inflation in Wales has left the rest of Britain standing. Average property values in Blaenau Gwent and Merthyr Tydfil rose 27.98% and 27.75% compared to the third quarter last year.

One thing the commentators generally agree on is that confidence in the housing market is improving.

A recent survey by Propertyfinder, a website, revealed that 54% of househunters - rising to 61% in London and the south east - expect property prices to increase over the next 12 months.

This should help to create a more dynamic market as confident buyers feel more comfortable stretching themselves and are less likely to postpone putting in an offer in the hope that prices will dive.

The real losers are the STRs and FTBs who are delaying buying a property as they patiently wait for a crash that will cause house prices to drop but many of them have found that house prices increased rather than fell while they were waiting for the right time to enter the market.

Estate agents' books illustrate that all-important first-time buyers – who stimulate movement further up the chain as well as on the lower rungs of the ladder – are already returning to the market in volumes not seen for many months.

Figures from the Inland Revenue show that the number of residential property transactions grew by 16% between the second and third quarters of this year.

And Bank of England statistics reveal that the number of mortgage approvals agreed to fund house purchases increased.

The reasons for this renewed enthusiasm include better employment figures and the Bank of England's decision to cut the base rate – to which most mortgage interest rates are linked – to 4.5% in August.

Many economists believe the BoE could drop rates again next year, leading estate agents such as Knight Frank to predict that the recent flurry of activity will continue into 2006.

AWOOGA ! off to the troll sub forum with thee...........

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Many of the house price crash related predictions over the last six months have not come true. The house price crash predictions have just not happened. I would say that a property crash is unlikely to occur in the next five years.

Home owners in general are very unwilling to drop their price and this fact has been severely underestimated. I have looked at a few properties recently and all of them uttered those immortal words 'and house prices only go up you know'.

At the moment I do not see any events in 2006 that will make the housing market crash. There will be some negative economic news but this will not affect most people and will not bring on a house price crash.

The housing market lives or dies by the level of interest rates, unless there is some sort of genuine shock to the economy. I would predict house prices rising by between 5 and 10 percent this year.

The economic growth figures will be poor, unemployment and personal/business bankruptcies will rise, retail figures remain poor but none of the figures will be a disaster but they will be enough to make the Bank of England react with interest rate cuts. I would expect interest rates to be below 4% before the year is out.

Despite the increases in commodity prices inflation will remain low allowing the Bank of England to cut interest rates.

A lot has been written as to housing being unaffordable but I don't think this is the case yet. People in general are taking in all the positve news about property in the media and will do anything to get on the ladder. They will take on interest only mortgages with a view to paying money off it later, they will lie about their income, they will get big deposits from mum and dad, rooms can be rented out, they will part buy with the Government or the builder, couples of course have a double income and there may well be many other creative ways of getting on the ladder.

Have you been up all night ?

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Is it me or does the House Price Armageddon contribution sound like some sort of Government briefing note to keep the sheeple subdued?

JD :ph34r:

it is bruno / bill gates

our resident nutter :P

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The STRs are making a big mistake in thinking that a property crash will somehow make property prices cheap when this is clearly not the case since property is expensive even during an economic slump.

The STRs believe that it will be easy to buy a property on the cheap during a crash in the hope of making alot of money by selling the property for a much higher price in the next property boom but the flaw in this argument is that there is unlikely to be another property boom for at least ten years which means that if the STRs buy a property soon after a crash they will effectively be spending alot of money in buying an asset that will not be appreciating in value for many years.

Buying a property during a crash will end up being a financial liability because the value of the property is likely to languish at the bottom for many years and will not rise in value to keep up with inflation, which means that the buyer will be continually losing money in having invested so much in an asset that is not rising in value to keep up with inflation.

The STRs would like to see a property crash to occur so that they can buy a property on the cheap but the major drawback is that when the crash does finally happen many STRs will be put off from buying a property even though house prices will be low because many STRs will be badly affected by any economic slump and will find it difficult to earn a living during a recession in which businesses are closing and going bankrupt and people are being thrown out of work and many STRs will face job insecurity and some will lose their job and find it difficult to find another job.

The STRs only chance of getting back onto the property ladder is if a severe recession occurs that manages to bring house prices back to normal which means that the STRs can look forward to going house hunting during an economic slump.

The STRs are clearly amateur property speculators who think that they can make it as serious property investors, but serious property investors know that timing is crucial and that there is no point in buying a property if it is not likely to appreciate in value for many years because it is just tying up money in an asset that is not rising in value to keep up with inflation which means that buying a property during a crash will end up losing money because the value of the property will be languishing whilst the value of the property will be continually being eroded away by inflation.

The STRs appear completely clueless about the property market and lack the necessary knowledge and understanding about the economic cycle and the basic way the economy works. The STRs are just fumbling around in the dark and don't have the foggiest idea what they are doing and are desperately hoping for events to go their way but this is just plain wishful thinking.

The STRs don't have any idea what the trigger will be that will cause a property crash; they don't know when the crash will occur; by how much house prices will fall; and when the trough in house prices will be reached. What is even worse is that the STRs are hoping to buy a property on the cheap during a crash without knowing when the next housing boom is likely to occur and by how much house prices will rise in the next property boom.

With all this uncertainty it makes you wonder why the STRs are bothering waiting for a property crash to occur because the STRs don't know when the next house price boom will occur and it is likely that the next property boom won't occur until a long and deep recession has occurred that has completely unravelled and unwound the current boom which will take many years.

It is only when the next recession has succeeded in bringing down the current economic boom and flattened the economy so that it has removed all the excesses and distortions of the boom and purged the economy of all the inflationary excesses of the boom, only then will the economy be in a state where another boom can then take place causing another housing boom to begin.

It is absolutely crazy and insane to buy a property during a crash when property prices are expected to be falling or languishing at the bottom for many years. Sensible property investors buy property when the economy is about to enter another boom that will cause house prices to rise rather than buying property when the economy is entering a long and deep recession that will keep house prices depressed for many years.

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The STRs thought they were the winners when they sold their property for profit at a high price but they are finding to their cost that the property crash has not materialised and doesn't look likely to happen for a long time to come which means that the STRs will continue paying all that dead money in rent that is helping to pay off their landlord's mortgage.

The continuing housing boom is making the STRs plight worse because it means that the value of the STRs fund money they made in selling their house is being eroded by inflation and if the STR continue to remain in limbo and delay using their STR fund money in getting back onto the property ladder then the STRs will eventually find that by the time they get the chance to buy a property the value of their STR fund money will be worthless because it has been eroded away by inflation.

Even if the crash were to happen soon the STRs will still find themselves having to wait many years before property prices reach the bottom at which point it will become the right time to get back onto the property ladder. The STRs will find that they will eventually get the chance to buy a property more cheaply in a crash but property prices are unlikely to rise for many years until the next economic boom develops which means that the STRs will be tying up and spending alot of money in buying a property that will not be appreciating in value for many years.

If the STRs do buy a property that is not appreciating in value then they will be effectively losing money because the value of the property is not keeping up with inflation which means that the value of the property is being eroded away by inflation.

The STRS find themselves in a no win situation in that if they continue to stay out of the property market their STR fund money will just continue to lose value because it is being eroded by inflation and their STR money will eventually end up worthless and if the STRs do eventually buy a property during a crash they will find that the value of the property will not be appreicating in value for many years which means that it will not be keeping up with inflation and they will be losing money because the value of the property is continually being eroded away by inflation.

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The continuing housing boom is causing the STRs much stress and anguish because they had hoped that the property crash would happen soon after they sold their property but this was always wishful thinking and the STRs have seriously misjudged the strength of the housing boom and are perplexed and getting increasingly frustrated at seeing no signs of a property crash occurring soon.

The STRs made their decision to sell to rent based on short term greed and on the assumption that a property crash would happen soon after they sold their property but this has proved to be a serious misjudgement and mistake and is proving to a terrible and costly miscalculation because it means that the STRs are forced to stay in rented accommodation for much longer than they had expected which has resulting in a significant increase in their living expenses and outgoings because of all the costs associated with living in rented accommodation and the STRs will continue paying alot of dead money in rent that is helping to pay off the landlord's mortage whilst they continue to see the value of their STR fund money being eroded away by inflation.

Many STRs are having deep misgivings and regrets about their decision to sell to rent and each and every day they wonder whether they sold too early and missed out on all the additional rises in house prices that have occurred since they sold their property.

The STRs had not anticipated that the housing boom would continue for so long and their decision to sell to rent was based on the assumption that a property crash would have happened by now so that they can get back onto the property ladder quickly and buy a property more cheaply but the property crash remains as elusive as ever and the STRs are having to live with the long term consequences of their rash and ill-judged decision to sell to rent and many will find it very difficult to get back onto the property ladder in the future and some may end up living in rented accommodation forever.

The STRs made a lifestyle choice to sell to rent thinking that they will only be living in rented acocommodation for a short while and hoped that they would put up with the inconvenience of renting for only a short time but this proved to be a serious miscalculation since there is little prospect of a property crash occurring soon and even if a property crash did happen they would have to wait many years before the trough has been reached in house prices before it becomes a right time to buy a property which means that the STRs will have to put up with the inconvenience and costs and significant drawbacks of renting for much longer than they ever expected.

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The STRs are making a big mistake in thinking that a property crash will somehow make property prices cheap when this is clearly not the case since property is expensive even during an economic slump.

The STRs believe that it will be easy to buy a property on the cheap during a crash in the hope of making alot of money by selling the property for a much higher price in the next property boom but the flaw in this argument is that there is unlikely to be another property boom for at least ten years which means that if the STRs buy a property soon after a crash they will effectively be spending alot of money in buying an asset that will not be appreciating in value for many years.

Buying a property during a crash will end up being a financial liability because the value of the property is likely to languish at the bottom for many years and will not rise in value to keep up with inflation, which means that the buyer will be continually losing money in having invested so much in an asset that is not rising in value to keep up with inflation.

The STRs would like to see a property crash to occur so that they can buy a property on the cheap but the major drawback is that when the crash does finally happen many STRs will be put off from buying a property even though house prices will be low because many STRs will be badly affected by any economic slump and will find it difficult to earn a living during a recession in which businesses are closing and going bankrupt and people are being thrown out of work and many STRs will face job insecurity and some will lose their job and find it difficult to find another job.

The STRs only chance of getting back onto the property ladder is if a severe recession occurs that manages to bring house prices back to normal which means that the STRs can look forward to going house hunting during an economic slump.

The STRs are clearly amateur property speculators who think that they can make it as serious property investors, but serious property investors know that timing is crucial and that there is no point in buying a property if it is not likely to appreciate in value for many years because it is just tying up money in an asset that is not rising in value to keep up with inflation which means that buying a property during a crash will end up losing money because the value of the property will be languishing whilst the value of the property will be continually being eroded away by inflation.

The STRs appear completely clueless about the property market and lack the necessary knowledge and understanding about the economic cycle and the basic way the economy works. The STRs are just fumbling around in the dark and don't have the foggiest idea what they are doing and are desperately hoping for events to go their way but this is just plain wishful thinking.

The STRs don't have any idea what the trigger will be that will cause a property crash; they don't know when the crash will occur; by how much house prices will fall; and when the trough in house prices will be reached. What is even worse is that the STRs are hoping to buy a property on the cheap during a crash without knowing when the next housing boom is likely to occur and by how much house prices will rise in the next property boom.

With all this uncertainty it makes you wonder why the STRs are bothering waiting for a property crash to occur because the STRs don't know when the next house price boom will occur and it is likely that the next property boom won't occur until a long and deep recession has occurred that has completely unravelled and unwound the current boom which will take many years.

It is only when the next recession has succeeded in bringing down the current economic boom and flattened the economy so that it has removed all the excesses and distortions of the boom and purged the economy of all the inflationary excesses of the boom, only then will the economy be in a state where another boom can then take place causing another housing boom to begin.

It is absolutely crazy and insane to buy a property during a crash when property prices are expected to be falling or languishing at the bottom for many years. Sensible property investors buy property when the economy is about to enter another boom that will cause house prices to rise rather than buying property when the economy is entering a long and deep recession that will keep house prices depressed for many years.

Wrong thread mate!

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The STRs are getting itchy feet and are getting fed up of renting and hate paying all that dead money in rent that is helping to pay off the landlord's mortgage.

The STRs just can't wait to get back onto the property ladder. It is a bit wierd and bizarre that the STRs are so keen to get back onto the property ladder when they were so keen to get off the property ladder in the first place.

The STRs want to get back onto the property ladder quickly because they fear that their STR fund money that they made in selling their property is losing value all the time because it is being eroded away by inflation and the STRs are very anxious to re-invest their STR fund money back into property before their STR fund money ends up being worthless because of inflation.

The STRs arrogantly thought that once they got off the property ladder then they would be able to get back onto the property ladder with ease but they are finding to their horror that getting their foot back onto the property is not going to be as easy as they originally thought. The STRs did not consider the very real possibility that once they got off the property ladder then they may never get a chance of getting back onto the property ladder ever again.

The continuing housing boom is causing the STRs to experience severe financial and emotional problems because they had gambled on a property crash occurring soon after they sold their property which would have mean't that they would only be spending a short time living in rented accommodation but they are now finding that they will be living in rented accommodation for much longer than they had expected and this is causing the STRs to experience severe stress and anxiety and are becoming increasing moody and frustrated and distressed at not seeing any sign of the property crash occurring which is making the STRs try to alieviate their depression by indulging in retail therapy and spending lots of money just to take their minds off the property market and this has dramatically increased the outgoings and living costs of the STRs.

The STRs let short-term greed cloud their judgement and they sold their property for a high price, knowing full well that the property was way over-priced, to some poor over-stretched, niave and gullible buyer, ripping off the buyer in that the buyer payed far too much much for the property.

The STRs were quite happy to sell their property for a high price but they themselves are not prepared to pay a high price for property and are waiting for a crash to occur so that they can then buy a property more cheaply. It is only reasonable that since the STRs were happy to sell their property for a high price then the STRs should themselves be prepared to pay a high price for property.

It would be hypocritical and two-faced of the STRs to insist that someone pay a high price for their property only for the STR to insist that they themselves are only willing to buy a property at a low price.

The STRS hate living in rented accommodation because they have discovered to their cost that their living expenses and general outgoings have significantly increased since selling their property and moving into rented accommodation. The STRs can't stand being in their rented accommodation for long without tearing their teeth out and as a consequence are find themselves going out more often and spending much more money than they did when they owned their own property and stayed in more often which has mean't that their expenses have risen considerably since moving into rented accommodation.

The STRs had hoped that a property crash would have happened soon after they sold their property so that they would only spend a short time living in rented accommodation and that they would be able to quickly get back on to the property ladder and buy a property more cheaply during a crash. However, the property crash has not occurred and there is no sign of a property crash occurring and it is unlikely to occur for many years to come which means that the STRS are fbeing orced to stay living in rented accommodation for much longer than they had expected, paying all that dead money in rent that is helping to pay off their landlord's mortgage.

Given the choice the STRs would much rather be living in a home of their own than living in rented accommodation. They made their decision to sell to rent based on the mistaken assumption that they will be renting for only a short time because they had assumed that a property crash would have happened soon after they sold their property but this has proved to be wishful thinking and the STRs are now paying a terribly high price for their ill-judged decision to sell to rent and are find themselves living in a place they hate for much longer than they had ever expected and are facing the very real prospect of never getting the chance of getting back onto the property ladder ever again.

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I'm going to print off Razmatazz's post to read before bedtime. I have planned a busy day at the Spring Fair in Birmingham tomorrow and need a good nights sleep. -_-

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The STRs are making a big mistake in thinking that a property crash will somehow make property prices cheap when this is clearly not the case since property is expensive even during an economic slump.

The STRs believe that it will be easy to buy a property on the cheap during a crash in the hope of making alot of money by selling the property for a much higher price in the next property boom but the flaw in this argument is that there is unlikely to be another property boom for at least ten years which means that if the STRs buy a property soon after a crash they will effectively be spending alot of money in buying an asset that will not be appreciating in value for many years.

Buying a property during a crash will end up being a financial liability because the value of the property is likely to languish at the bottom for many years and will not rise in value to keep up with inflation, which means that the buyer will be continually losing money in having invested so much in an asset that is not rising in value to keep up with inflation.

The STRs would like to see a property crash to occur so that they can buy a property on the cheap but the major drawback is that when the crash does finally happen many STRs will be put off from buying a property even though house prices will be low because many STRs will be badly affected by any economic slump and will find it difficult to earn a living during a recession in which businesses are closing and going bankrupt and people are being thrown out of work and many STRs will face job insecurity and some will lose their job and find it difficult to find another job.

The STRs only chance of getting back onto the property ladder is if a severe recession occurs that manages to bring house prices back to normal which means that the STRs can look forward to going house hunting during an economic slump.

The STRs are clearly amateur property speculators who think that they can make it as serious property investors, but serious property investors know that timing is crucial and that there is no point in buying a property if it is not likely to appreciate in value for many years because it is just tying up money in an asset that is not rising in value to keep up with inflation which means that buying a property during a crash will end up losing money because the value of the property will be languishing whilst the value of the property will be continually being eroded away by inflation.

The STRs appear completely clueless about the property market and lack the necessary knowledge and understanding about the economic cycle and the basic way the economy works. The STRs are just fumbling around in the dark and don't have the foggiest idea what they are doing and are desperately hoping for events to go their way but this is just plain wishful thinking.

The STRs don't have any idea what the trigger will be that will cause a property crash; they don't know when the crash will occur; by how much house prices will fall; and when the trough in house prices will be reached. What is even worse is that the STRs are hoping to buy a property on the cheap during a crash without knowing when the next housing boom is likely to occur and by how much house prices will rise in the next property boom.

With all this uncertainty it makes you wonder why the STRs are bothering waiting for a property crash to occur because the STRs don't know when the next house price boom will occur and it is likely that the next property boom won't occur until a long and deep recession has occurred that has completely unravelled and unwound the current boom which will take many years.

It is only when the next recession has succeeded in bringing down the current economic boom and flattened the economy so that it has removed all the excesses and distortions of the boom and purged the economy of all the inflationary excesses of the boom, only then will the economy be in a state where another boom can then take place causing another housing boom to begin.

It is absolutely crazy and insane to buy a property during a crash when property prices are expected to be falling or languishing at the bottom for many years. Sensible property investors buy property when the economy is about to enter another boom that will cause house prices to rise rather than buying property when the economy is entering a long and deep recession that will keep house prices depressed for many years.

Errr.....OK, if you say so :unsure:

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The continuing housing boom is causing the STRs much stress and anguish because they had hoped that the property crash would happen soon after they sold their property but this was always wishful thinking and the STRs have seriously misjudged the strength of the housing boom and are perplexed and getting increasingly frustrated at seeing no signs of a property crash occurring soon.

...

The STRs made a lifestyle choice to sell to rent thinking that they will only be living in rented acocommodation for a short while and hoped that they would put up with the inconvenience of renting for only a short time but this proved to be a serious miscalculation since there is little prospect of a property crash occurring soon and even if a property crash did happen they would have to wait many years before the trough has been reached in house prices before it becomes a right time to buy a property which means that the STRs will have to put up with the inconvenience and costs and significant drawbacks of renting for much longer than they ever expected.

Bruno strikes again!

I think you'd be welcome if you took the time to write sensible arguments, instead of just rehashing your venomous gripes.

Edited by BandWagon

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razzmatazz

your post displays all the hallmarks of a confused and illogical mind- which one are you phil or kirsty?

The STRs are making a big mistake in thinking that a property crash will somehow make property prices cheap when this is clearly not the case since property is expensive even during an economic slump.

The STRs believe that it will be easy to buy a property on the cheap during a crash in the hope of making alot of money by selling the property for a much higher price in the next property boom but the flaw in this argument is that there is unlikely to be another property boom for at least ten years which means that if the STRs buy a property soon after a crash they will effectively be spending alot of money in buying an asset that will not be appreciating in value for many years.

Buying a property during a crash will end up being a financial liability because the value of the property is likely to languish at the bottom for many years and will not rise in value to keep up with inflation, which means that the buyer will be continually losing money in having invested so much in an asset that is not rising in value to keep up with inflation.

The STRs would like to see a property crash to occur so that they can buy a property on the cheap but the major drawback is that when the crash does finally happen many STRs will be put off from buying a property even though house prices will be low because many STRs will be badly affected by any economic slump and will find it difficult to earn a living during a recession in which businesses are closing and going bankrupt and people are being thrown out of work and many STRs will face job insecurity and some will lose their job and find it difficult to find another job.

The STRs only chance of getting back onto the property ladder is if a severe recession occurs that manages to bring house prices back to normal which means that the STRs can look forward to going house hunting during an economic slump.

The STRs are clearly amateur property speculators who think that they can make it as serious property investors, but serious property investors know that timing is crucial and that there is no point in buying a property if it is not likely to appreciate in value for many years because it is just tying up money in an asset that is not rising in value to keep up with inflation which means that buying a property during a crash will end up losing money because the value of the property will be languishing whilst the value of the property will be continually being eroded away by inflation.

The STRs appear completely clueless about the property market and lack the necessary knowledge and understanding about the economic cycle and the basic way the economy works. The STRs are just fumbling around in the dark and don't have the foggiest idea what they are doing and are desperately hoping for events to go their way but this is just plain wishful thinking.

The STRs don't have any idea what the trigger will be that will cause a property crash; they don't know when the crash will occur; by how much house prices will fall; and when the trough in house prices will be reached. What is even worse is that the STRs are hoping to buy a property on the cheap during a crash without knowing when the next housing boom is likely to occur and by how much house prices will rise in the next property boom.

With all this uncertainty it makes you wonder why the STRs are bothering waiting for a property crash to occur because the STRs don't know when the next house price boom will occur and it is likely that the next property boom won't occur until a long and deep recession has occurred that has completely unravelled and unwound the current boom which will take many years.

It is only when the next recession has succeeded in bringing down the current economic boom and flattened the economy so that it has removed all the excesses and distortions of the boom and purged the economy of all the inflationary excesses of the boom, only then will the economy be in a state where another boom can then take place causing another housing boom to begin.

It is absolutely crazy and insane to buy a property during a crash when property prices are expected to be falling or languishing at the bottom for many years. Sensible property investors buy property when the economy is about to enter another boom that will cause house prices to rise rather than buying property when the economy is entering a long and deep recession that will keep house prices depressed for many years.

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The STRs thought they were the winners when they sold their property for profit at a high price but they are finding to their cost that the property crash has not materialised and doesn't look likely to happen for a long time to come which means that the STRs will continue paying all that dead money in rent that is helping to pay off their landlord's mortgage.

The continuing housing boom is making the STRs plight worse because it means that the value of the STRs fund money they made in selling their house is being eroded by inflation and if the STR continue to remain in limbo and delay using their STR fund money in getting back onto the property ladder then the STRs will eventually find that by the time they get the chance to buy a property the value of their STR fund money will be worthless because it has been eroded away by inflation.

Even if the crash were to happen soon the STRs will still find themselves having to wait many years before property prices reach the bottom at which point it will become the right time to get back onto the property ladder. The STRs will find that they will eventually get the chance to buy a property more cheaply in a crash but property prices are unlikely to rise for many years until the next economic boom develops which means that the STRs will be tying up and spending alot of money in buying a property that will not be appreciating in value for many years.

If the STRs do buy a property that is not appreciating in value then they will be effectively losing money because the value of the property is not keeping up with inflation which means that the value of the property is being eroded away by inflation.

The STRS find themselves in a no win situation in that if they continue to stay out of the property market their STR fund money will just continue to lose value because it is being eroded by inflation and their STR money will eventually end up worthless and if the STRs do eventually buy a property during a crash they will find that the value of the property will not be appreicating in value for many years which means that it will not be keeping up with inflation and they will be losing money because the value of the property is continually being eroded away by inflation.

TIT :P

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The STRs thought they were the winners when they sold their property for profit at a high price but they are finding to their cost that the property crash has not materialised and doesn't look likely to happen for a long time to come which means that the STRs will continue paying all that dead money in rent that is helping to pay off their landlord's mortgage.

The continuing housing boom is making the STRs plight worse because it means that the value of the STRs fund money they made in selling their house is being eroded by inflation and if the STR continue to remain in limbo and delay using their STR fund money in getting back onto the property ladder then the STRs will eventually find that by the time they get the chance to buy a property the value of their STR fund money will be worthless because it has been eroded away by inflation.

Even if the crash were to happen soon the STRs will still find themselves having to wait many years before property prices reach the bottom at which point it will become the right time to get back onto the property ladder. The STRs will find that they will eventually get the chance to buy a property more cheaply in a crash but property prices are unlikely to rise for many years until the next economic boom develops which means that the STRs will be tying up and spending alot of money in buying a property that will not be appreciating in value for many years.

If the STRs do buy a property that is not appreciating in value then they will be effectively losing money because the value of the property is not keeping up with inflation which means that the value of the property is being eroded away by inflation.

The STRS find themselves in a no win situation in that if they continue to stay out of the property market their STR fund money will just continue to lose value because it is being eroded by inflation and their STR money will eventually end up worthless and if the STRs do eventually buy a property during a crash they will find that the value of the property will not be appreicating in value for many years which means that it will not be keeping up with inflation and they will be losing money because the value of the property is continually being eroded away by inflation.

"The continuing housing boom" :lol::lol::lol::lol::lol::lol::lol:

Since when does a HPI of -2% in Q4 constitute a boom? Money in the bank (@5%) would be earning 7% more than a house

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  • 301 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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