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cupidstunt

Is It Really So Different This Time?

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Ahhhh remember those heady days of the late eighties. Mobile telephones the size of a brick, Harry Enfield and Loadsofmoney. Greed was good and House prices only ever only went up – the talk of the dinner party. You couldn’t sell your House? Something must be wrong? Sack the Estate Agents! Next doors just sold to cash buyers so yours must be worth another couple of grand. Oh well never mind it’ll soon shift and in the meantime we’ll get a “bridging loan” to buy our next house……

Move on more than fifteen years. Well the mobile phones got smaller and cheaper and Harry Enfield’s no longer got loadsofmoney, but not a lot has changed in the Housing market scenario – apart from the prices! Greed is back, properties the talk of the dinner party, but whatever became of the “bridging loan”? Naaah – we don’t need that any longer ‘cause House prices only ever go up so we’ll keep it as a BTL That’s what my friend Tarquins doing and he’s now got a “portfolio” They’re all on 90% mortgages but he’s MEWed on his House for the deposits so that’s OK?

We’ve moved on but few things have changed – certainly not the stupidity of the House buying public. Moneymarkets have already started pricing in the IR’s and that’s now moving on to the lenders. When the BoE finally get around to it the Householder will be hit by another hike, and suddenly it will all dawn ……WHERE THE BLOODY HELL DO I GET THE MONEY FROM TO KEEP PAYING MY MORTGAGE!

Edited by cupidstunt

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The only thing I can remember from last time before it went pop was broom cupboards and car spaces going for silly money in Kensington.

Funnily enough (not actually), there was an article in that bastion of journalism, The Evening Standard, this week about a car space in West Kensington going for something like 70K. The agent, our friends Foxtons, even tried to talk it up with a % breakdown of what "quality" materials was used to make it.

In my opinion we are once more on the cusp, but it will be much worse this time as people are more highly geared and massively sensitive the IR rises.

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The only thing I can remember from last time before it went pop was broom cupboards and car spaces going for silly money in Kensington.

Funnily enough (not actually), there was an article in that bastion of journalism, The Evening Standard, this week about a car space in West Kensington going for something like 70K. The agent, our friends Foxtons, even tried to talk it up with a % breakdown of what "quality" materials was used to make it.

In my opinion we are once more on the cusp, but it will be much worse this time as people are more highly geared and massively sensitive the IR rises.

We had a thread on that precise car parking space on this board several weeks ago. Try to keep up Evening Standard.

Billy Shears

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We had a thread on that precise car parking space on this board several weeks ago. Try to keep up Evening Standard.

Billy Shears

It was definately in there last night or maybe Wed.

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Having actually been through the 1988 crash I would say it feels exactly the same. We ended up bridging - which was a stupid mistake. It cost a bit but we did sell our other place within a year but we had done it up and we might as well have sold it un-done up a year earlier.

We are trying to buy & sell at the moment and it is an absolute nightmare. We keep losing things we are trying to buy and having endless hold ups on the property we are selling (buyer number 4 shortly to be replaced with buyer number 5).

We had this in 1988 - kept losing propertties either because people took them off the market or we were gazumped. Ended up paying full asking price on our place and it then fell 15% Not that it was a problem as we stayed put. However, if the interest rates had stayed at 15% it would have been a different story.

Everyone I know in property (surveyors etc) say it is not the same as the economy is different, interest rates are low etc.

Only time will tell.

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Ahhhh remember those heady days of the late eighties. Mobile telephones the size of a brick, Harry Enfield and Loadsofmoney. Greed was good and House prices only ever only went up – the talk of the dinner party. You couldn’t sell your House? Something must be wrong? Sack the Estate Agents! Next doors just sold to cash buyers so yours must be worth another couple of grand. Oh well never mind it’ll soon shift and in the meantime we’ll get a “bridging loan” to buy our next house……

Move on more than fifteen years. Well the mobile phones got smaller and cheaper and Harry Enfield’s no longer got loadsofmoney, but not a lot has changed in the Housing market scenario – apart from the prices! Greed is back, properties the talk of the dinner party, but whatever became of the “bridging loan”? Naaah – we don’t need that any longer ‘cause House prices only ever go up so we’ll keep it as a BTL That’s what my friend Tarquins doing and he’s now got a “portfolio” They’re all on 90% mortgages but he’s MEWed on his House for the deposits so that’s OK?

We’ve moved on but few things have changed – certainly not the stupidity of the House buying public. Moneymarkets have already started pricing in the IR’s and that’s now moving on to the lenders. When the BoE finally get around to it the Householder will be hit by another hike, and suddenly it will all dawn ……WHERE THE BLOODY HELL DO I GET THE MONEY FROM TO KEEP PAYING MY MORTGAGE!

Is his name really Tarquin??? :lol::lol::lol::huh:

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Having actually been through the 1988 crash I would say it feels exactly the same. We ended up bridging - which was a stupid mistake. It cost a bit but we did sell our other place within a year but we had done it up and we might as well have sold it un-done up a year earlier.

We are trying to buy & sell at the moment and it is an absolute nightmare. We keep losing things we are trying to buy and having endless hold ups on the property we are selling (buyer number 4 shortly to be replaced with buyer number 5).

We had this in 1988 - kept losing propertties either because people took them off the market or we were gazumped. Ended up paying full asking price on our place and it then fell 15% Not that it was a problem as we stayed put. However, if the interest rates had stayed at 15% it would have been a different story.

Everyone I know in property (surveyors etc) say it is not the same as the economy is different, interest rates are low etc.

Only time will tell.

I don't mean to be rude, by why on earth are you about to make the same mistake twice? :blink:

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I don't mean to be rude, by why on earth are you about to make the same mistake twice? :blink:

Quite!

Apart from the seemingly acknowledged toppy nature of the current market you have 4 buyers drop out - what does that tell you about the robustness of the market beneath you...Thought about STR?

Don't worry, in 1988 prices were 4.8 times average salary now they're only, er, 6...

Edited by Tempest

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I don't mean to be rude, by why on earth are you about to make the same mistake twice? :blink:

Yep

People are saying its as bad as last time and still buying. They know it wasnt too bad last time and they survived only the over exposed took a hit, but I do not think they realize that its different this time!!!!!! People have got complacent, maybe they will be ok (obviously they will loss financially) but they may survive.

Do not compare the current situation with the late 80s early 90s but with the late 20s early 30s as we have more factors in common. Time to watch some old 1920s movies (roaring 20s) and then some 1930s (recession) to get an idea of the mood in the US and UK

Could this be some giant 90 year cycle?

Edited by Flat Bear

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Do not compare the current situation with the late 80s early 90s but with the late 20s early 30s as we have more factors in common. Time to watch some old 1920s movies (roaring 20s) and then some 1930s (recession) to get an idea of the mood in the US and UK

Could this be some giant 90 year cycle?

OK just don't mention the 6 year world war which followed soon after :unsure:

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Spot on cupidstunt.

The thing that amazes me is the amount of people that should know better charging head long in denial.

Time is a great healer and greed generaly over comes fear!

Some are new mugs some are old mugs coming back for another dose.

It's like watching the same train crash in slow motion.

Pablo Silver or Lead?

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I don't mean to be rude, by why on earth are you about to make the same mistake twice? :blink:

Not rude at all.

I don't think we are making the same mistake as this time we intend to sell and then buy. If the worst did come to the worst, then we would rent out the first place which would cover the mortgage. In 1988 the rent would not have touched the mortgage.

Edited by Given Up

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Flippin' eck, I thought he would've had cancer or something!

That is what it was like. People got so hyped up about it all and then they could not live with the fact that their mortgage was having to pay for a loan worth less than the value of the house.

A couple where I worked had the same problem. She was my colleague, they were a great couple, classic Yuppies, down from Doncaster and living it up in the city.

In fact then they were called Dinkies

Dinkies = Dual Income No Kids

They bought a lovely apartment in ... er ... Camberwell (in 1989) only to see the price fall through the floor and were really devasted by this.

Of course, time heals all wounds

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The difference this time will be on the scale of the things IMO

Last time we had loads of people in negative equity - everyone on the street knew someone who bought at the top and saw the price fall. BUT for many it didn't matter - they just held tight. Many more lost their home. BUT it was all a very individual experience.

This time around I think fewer people will be hit - if interests rates stay lowish. But I think those that are hit will be hit much harder and faster than last time.

When one person went down last time they took one house with them.

This time one person getting into trouble could see 2/3/4/5 or more house/property all hitting the market at the same time. This will have an impact on public sentiment.

I am already seeing this in may area -3/4/5 properties all on the same road at the same price being put on the market at the same time.

Once the BTL brigade who jumped in at the top decide to sell the market could be flooded overnight with property.

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Fear of the future (BTL retirement income) is an additional factor this time round and probably why it seems more sustained - but it's probably going to trash the economy long term with debt

Who knows whats going to happen....

Edited by dnd

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Flippin' eck, I thought he would've had cancer or something!

:lol:

But negative equity is worse than cancer. Its tantamount to chinese water torture.

Not rude at all.

I don't think we are making the same mistake as this time we intend to sell and then buy. If the worst did come to the worst, then we would rent out the first place which would cover the mortgage. In 1988 the rent would not have touched the mortgage.

I was actually referring to buying at the top of the market. I did it once, I won't do it again.

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The present house price increases and crazy attitudes to borrowing remind me more of the late 90's with the Technology stock boom. I unfortunately got sucked in and thankfully only invested a small amount which was entirely lost.

This apparent indifference to current warnings of interest rate rises and subsequent property price reductions definitely has a deja vu feeling. I remember quite clearly the lemming type rush to invest in the stock market at all costs. Don't worry about your investment, it can only ever go up. Just beg, borrow or steal the money to invest.

At least this time there will be no excuse that warnings were not given.

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At least this time there will be no excuse that warnings were not given.

Depends on where/if the warnings are published. I'm thinking here about two people I work with. Both quite young (one very) and on pretty poor salaries. They have both stretched themselves to the max to buy new build flats on near 100% mortgages and are absolutely convinced that they have made sound investments, because house prices only ever go up, rent is dead money, blah blah ad nauseum. If prices fall it will be them crying at their desks. One of them's a complete **** so I don't care quite frankly - in fact I'm kind of willing it to happen (but that's anpther story), but the other is very sweet and I can see the crap she's about to get in really screwing up her twenties - stopping her being able to start a family when she wants, trapping her in this crappy job - that kind of thing.

The warnings might be there but until they publish them in Heat I can't see them helping much.

Edited by vicster

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I was in my early 20's & remember a bloke sobbing at his work desk because of negative equity... :o

Nah - he was just trying to use Microsoft bloody Windows.

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Nah - he was just trying to use Microsoft bloody Windows.

Or 'WordPerfect' - F2, F11, F6 :rolleyes:

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:lol:

But negative equity is worse than cancer. Its tantamount to chinese water torture.

I was actually referring to buying at the top of the market. I did it once, I won't do it again.

If it is the top then we will be selling and buying at the top - not a huge problem as the prices are the same.

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If it is the top then we will be selling and buying at the top - not a huge problem as the prices are the same.

I understand what you are trying to say, but why would you buy at the top?? Buy low, sell high? The point is not if the prices are the same, but whether or not you are paying over the odds. Personally, I would STR at the moment, but if you are happy to buy this way and not looking to sell for 10 years + then it might be a different situation for you. Good luck anyway, I hope it doesnt all go Pete Tong again for you. Too risky for little old cautious me. :rolleyes:

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I understand what you are trying to say, but why would you buy at the top?? Buy low, sell high? The point is not if the prices are the same, but whether or not you are paying over the odds. Personally, I would STR at the moment, but if you are happy to buy this way and not looking to sell for 10 years + then it might be a different situation for you. Good luck anyway, I hope it doesnt all go Pete Tong again for you. Too risky for little old cautious me. :rolleyes:

I soppose I would prefer not to move twice and also am not convinced we are at the top of the market - we may be we might not. I would prefer the risk of owning something which will go down and then recover than to sit in a rented place and watch the prices going up.

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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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