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Jason

Financial Times House Price Index

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Nice – so if I was going to buy a house last month for £200000 –

I would now have to find an extra £1600 and the same next month –so on so on

Not if you live in the Midlands!

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Nice – so if I was going to buy a house last month for £200000 –

I would now have to find an extra £1600 and the same next month –so on so on

So you're saying house prices are going to rise by £1600 next month, and the next month, and so on ad infinitum?

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1600 next month, and the next month, and so on ad infinitum?

It’s not what I meant – just until something stops it – if IR’s go up then that will put the brakes on.

I think it will go up for the next 3-6 months though

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It’s not what I meant – just until something stops it – if IR’s go up then that will put the brakes on.

I think it will go up for the next 3-6 months though

Doesn't really make any odds though does it - the £200,000 is out of reach for most anyway. Going up another £9,600 isn't going to make FTBs think "Oh, I should have bought 6 months ago".

HPs can keep going up forever, no one who wants to move benefits unless their parents pop off and leave them a nice wodge of real estate. Only the exchequer and the banks benefit.

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It’s not what I meant – just until something stops it – if IR’s go up then that will put the brakes on.

I think it will go up for the next 3-6 months though

Agree - I'd assumed there was going to be a healthy "Spring bounce"

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It’s not what I meant – just until something stops it – if IR’s go up then that will put the brakes on.

I think it will go up for the next 3-6 months though

Fair enough.

As a counter-point your logic though, I've calculated that if property in my area drops by 5% over the next 3 years and I wait till then to buy, I'll have made a net profit from renting. This is partly thanks to the wonder of mortgage interest being heavily front loaded and even excludes property maintenance fees. In the mean-time my deposit is growing quite substantially every month and I'm earning some interest by keeping it in the bank.

I agree prices probably will bounce a bit in the spring and I've no idea where they'll go next. The bottom line is that buying now is too big a gamble and I'm happy to wait. If prices continue upwards I'll wait even longer, but I'm not going to be terrorised into buying by threats that I'm being 'left behind'. You can't leave behind an entire generation.

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Doesn't really make any odds though does it - the £200,000 is out of reach for most anyway. Going up another £9,600 isn't going to make FTBs think "Oh, I should have bought 6 months ago".

HPs can keep going up forever, no one who wants to move benefits unless their parents pop off and leave them a nice wodge of real estate. Only the exchequer and the banks benefit.

£200000 may be out of reach but that won’t stop it from happening

We just have to look to Ireland to see what happens to affordability (out the window) if you have speculation and low interest rates.

As a counter-point your logic though, I've calculated that if property in my area drops by 5% over the next 3 years and I wait till then to buy, I'll have made a net profit from renting. This is partly thanks to the wonder of mortgage interest being heavily front loaded and even excludes property maintenance fees. In the mean-time my deposit is growing quite substantially every month and I'm earning some interest by keeping it in the bank.

I don’t think stagnation is viable- prices in my opinion will ether double over the next few years (before crashing) or they will half (crash)

All dependent on interest rates – anyone got a coin and hopefully a bit lucky with their tosses

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I don’t think stagnation is viable- prices in my opinion will ether double over the next few years (before crashing) or they will half (crash)

All dependent on interest rates – anyone got a coin and hopefully a bit lucky with their tosses

Scary.

If interest rates go down substantially and housing booms yet again I'd suggest everyone under thirty starts learning another European language and packs their bags - I know I will. An E. European can take my place in the workforce and use their wages to build a house in their home country.

Edited by HPCheese

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Its you b*ggers darn South again, too much money and not enough commonsense.

About to start another ripple of HPI - come on get a grip ! - we've not finished with the last price boom in the North and you lot are stoking up another.

Was it like this last time ?

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£200000 may be out of reach but that won’t stop it from happening

We just have to look to Ireland to see what happens to affordability (out the window) if you have speculation and low interest rates.

I don’t think stagnation is viable- prices in my opinion will ether double over the next few years (before crashing) or they will half (crash)

All dependent on interest rates – anyone got a coin and hopefully a bit lucky with their tosses

200,000 is the average price. What is an average property? is it 3 beds semi? Do FTB's expect to live in an average place? It seems daft to me, surely an FTB will try & buy a place which is below the average.

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The FT figures have to be taken seriously and do indicate a mild recovery in the market over the last few months.

Maybe some of the pent-up demand has capitulated, spurred on by slightly lower interest rates of last autumn, the availability of IO mortgages and other inducements? They've swallowed the bitter pill of potentially ruinous debt because it has a dusting of sugar and they feel panicked by the lack of sustained price drops, as well as relentless bubble talk from the VIs and the OO generation.

Maybe there is cross-generational subsidy going on (a lot of talk in the press about this).

Maybe there is a flight to quality, as with reduced volume the good houses are more sought after and still getting near to their asking price, whilst much of the stock still languishes.

Maybe the really, really uninformed are still getting into BTLs.

Bubble markets do have last hurrahs but that doesn't alter their lack of fundamentals. I read somewhere that at this stage of the economic cycle the crowd is typically feeling worried but they don't know why. Times seem good, easy credit is still flowing but somehow it doesn't feel right. In these circumstances all sorts of irrational behaviour is amplified. We are seeing it all over the place right now not just houses but stocks and the dollar too. It will pass as the credit screws are tightened - as they inexorably will over the next year.

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Its you b*ggers darn South again, too much money and not enough commonsense.

About to start another ripple of HPI - come on get a grip ! - we've not finished with the last price boom in the North and you lot are stoking up another.

Was it like this last time ?

yup

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Maybe the really, really uninformed are still getting into BTLs.

I don’t think this BLT is as bigger loss as they make out on this site – if you do the maths you do ok but not good – if think that house prices will go up then it’s a good investment

I think it’s what’s happening at the bottom end that’s important

Who is buying –FTB’s were at a low – so is it BTL’ers – maybe people will just rent, as houses (if not on the ladder) are just unaffordable

I know a couple of people that own 1 house just to go out and get another as a holiday home / investment

Is there a shortage of houses?

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Nice – so if I was going to buy a house last month for £200000 –

I would now have to find an extra £1600 and the same next month –so on so on

Well, if you buy a new bulid from RedRow homes they'll let you

have one for £13,600 less than last year, as their ave price has

fallen from £176,700 to £163,100. Lucky you didn't buy one last

year <_<

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I don’t think this BLT is as bigger loss as they make out on this site – if you do the maths you do ok but not good – if think that house prices will go up then it’s a good investment

I think it’s what’s happening at the bottom end that’s important

Who is buying –FTB’s were at a low – so is it BTL’ers – maybe people will just rent, as houses (if not on the ladder) are just unaffordable

I know a couple of people that own 1 house just to go out and get another as a holiday home / investment

Is there a shortage of houses?

Yes but the examples you mention are based on bubble thinking. Viz:

"Everyone is doing this BTL. Pity I didn't notice it before but I have to get in now. No I won't quite get the mortgage payments back in rent but I'll have the value of the house at the end and it's bound to go up. What's a void by the way? Oh and I need to get the tools to fix a gas boiler. CORGI, what's that? What do you mean pay tax on the rent income, nobody does that."

"Yeah we bought a holiday home on an IO mortgage. We can afford it just about but hey, interest rates have to come down according to the papers and we're living the dream! We'll sell it it at some point and make a nice profit. I mean they only go up don't they. Bank of Japan, what's that got to do with it?"

And what does a "shortage of houses mean"? Yes, if we all want one each. Even more if we want two each. But this is a market. It doesn't work on wants and needs but effective demand. That means having the resources and be willing to spend them. At the moment people mostly don't really have the resources but ultra loose lending practices and low IR make them think they do. As credit tightens they will discover that what they have is debt not buying power.

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Maybe some of the pent-up demand has capitulated, spurred on by slightly lower interest rates of last autumn, the availability of IO mortgages and other inducements? They've swallowed the bitter pill of potentially ruinous debt because it has a dusting of sugar and they feel panicked by the lack of sustained price drops, as well as relentless bubble talk from the VIs and the OO generation.

Maybe there is cross-generational subsidy going on (a lot of talk in the press about this).

Maybe there is a flight to quality, as with reduced volume the good houses are more sought after and still getting near to their asking price, whilst much of the stock still languishes.

Maybe the really, really uninformed are still getting into BTLs.

Why buy?

I was waiting to for prices to come off before making a move. 18 months later, nothing had happened other than price stagnation and a life changing event being 18 months closer which made waiting no longer an option. Add to this that the amount of stock in the area I wanted has reduced significantly, and that the balance of likely outcomes seems now to be stagnation over crash. Even then, the property had been on the market and had fallen through with another buyer. No way I was getting into a bidding war on a fresh house.

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If interest rates go down substantially and housing booms yet again I'd suggest everyone under thirty starts learning another European language and packs their bags -

E European prices are rocketing so get packing.

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E European prices are rocketing so get packing.

I've heard derelict Estonian barns and out-houses are the hot BTL investment for 2006. I heard it at a property show from a 2nd-generation Estonian-British estate agent.

Seriously though, read what I said again - "If interest rates go down substantially and housing booms yet again...".

I'm off to extract the equity from my Honda Civic and invest it in a 'remote woodland dwelling' in Latvia.

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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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