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krosfyah

When House Prices Do Fall...

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I sit here dreaming, positively dreaming of clicking on bbc.co.uk and seeing "Breaking News - House Prices fall by 40% overnight!" plastered all over the front of the website. But honestly, what does this mean? It would mean that we were in some serious sh1t, no doubt about that, and when i say we, i mean all of us, in the UK, as the economy would have to have gone tits well and truly up for something like this to happen.

That would mean jobs on the line (or redundancies), people who have just wanted to get on the ladder and over extended themselves so much that they can't make repayments now (some say it's their own fault, me personally, everyone is different and to look down on someone when they are in that position is just not something i think i would do).

Would a CRASH be something really, truly want? Personally, i would like to see a gentle slide - something that in economic terms is unlikely i know, but at least it would allow people time to prepare themselves.

Finally here is some food for thought - if 20-40% of the property market is priced out FTB's who are just sitting, waiting and saving and there IS a crash - surely it would only last as long as it takes for those thousands who are just waiting for the moment to pounce, and demand would be so strong from new buyers that HPI would just begin to stabilise straight away and prices would probably bounce back up again.

Whichever way you look at it, it's a tough call. On the one hand i want prices to come crashing down, on the other i know that probably won't help my situation out, and a lot of people will be in deep sh1t as a result.

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You will be out of a job, your savings will be worth less and general recession before house prices crash :) the price of a house will be the least of your worries.

Edited by zag2me

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You will be out of a job, your savings will be worth less and general recession before house prices crash :) the price of a house will be the least of your worries.

That sounds fantastic to me! Give me a couple of years sharp pain over 25 years of outdrawn misery any time!

A recession is temporary, the debt if you take on a house today lasts for 25 years (assuming you don't go for I/O, of course, in which case it lasts forever).

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That sounds fantastic to me! Give me a couple of years sharp pain over 25 years of outdrawn misery any time!

A recession is temporary, the debt if you take on a house today lasts for 25 years (assuming you don't go for I/O, of course, in which case it lasts forever).

Obviously, you have never found yourself in a desperate situation not of your own making. ie redundancy.

It is not pleasant and can lead to the decimation of families as a result.

Be careful what you wish for.

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Obviously, you have never found yourself in a desperate situation not of your own making. ie redundancy.

It is not pleasant and can lead to the decimation of families as a result.

Be careful what you wish for.

I'm afraid this latest house price boom has shown the true nature of many - out for themselves and an 'I'm alright in my house jack' mentality with little or no regard for those that didn't buy 5-10 years ago. Even within families (mine included) there are some small noices of understanding of the FTB generation but a deeper feeling of satisfaction as house prices have gone higher. 'Yes it is difficult but it was for us when we bought our first house' says my gran whose first house was a 3-bed bungalow in the SE.

Does anyone really care that I'm expected to take on a £200K mortgage for a 1-bed flat at 30 yrs old and that if I did that's about all I could afford for the next 10-15 years to have a family in?

F*ck society, those that fall in the coming crash deserve too, they are the cause of the problem in the first place.

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F*ck society, those that fall in the coming crash deserve too, they are the cause of the problem in the first place.

It isn't necessarily the housing crash that many need worry about. When my father and myself lost our jobs in the worst construction industry recession since the 30's it wasn't the mortgage that was the problem, it was the inability to make a living. Take that away and it makes no difference how big the mortgage is.

Many have been smug and stupid in the last 10 years. However, I am not sadistic enough to delight in other peoples misery.

Maybe I'm F*cked up.

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F*ck society, those that fall in the coming crash deserve too, they are the cause of the problem in the first place.

It isn't necessarily the housing crash that many need worry about. When my father and myself lost our jobs in the worst construction industry recession since the 30's it wasn't the mortgage that was the problem, it was the inability to make a living. Take that away and it makes no difference how big the mortgage is.

Many have been smug and stupid in the last 10 years. However, I am not sadistic enough to delight in other peoples misery.

Maybe I'm F*cked up.

To those that have smugly watched and cheered as their properties values rose, and to the BTlers who have exacerbated the situation... if they lose their jobs - tough sh1t.

To those that have been sensible and tried to pay off their mortgage and just want a home and lose their job - they have my every sympathy.

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To those that have smugly watched and cheered as their properties values rose, and to the BTlers who have exacerbated the situation... if they lose their jobs - tough sh1t.

To those that have been sensible and tried to pay off their mortgage and just want a home and lose their job - they have my every sympathy.

Agreed, there is a marked difference.

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I would be relieved to be honest, I may or may not loose my job but I have savings to tide me over for a good while if the worst happens - those rejoicing in the "value" of their home going up will get no sympathy from me when it starts dropping.

I feel for anyone who loses their job and has a family etc. but I would have no sympathy for any of the BTL brigade (I hope they all loose their own homes in the bankruptcy hearings) or anyone who owns a plasma TV/4x4 - they should have saved the cash - as I have!

And I would put the blame directly at the door of Messrs Brown and Blair too - people say the greed of the 80's and Thatcherism was bad but IMHO this is far worse and once the shit starts flying the country will be in an even worse state as it was then. They could have done something to stop things getting to the situation we are now in - enforced lending affordabiliy calcuations would have been helpful as well as stopping tax breaks to BTL and taxing the b'stards would have helped too.

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Finally here is some food for thought - if 20-40% of the property market is priced out FTB's who are just sitting, waiting and saving and there IS a crash - surely it would only last as long as it takes for those thousands who are just waiting for the moment to pounce, and demand would be so strong from new buyers that HPI would just begin to stabilise straight away and prices would probably bounce back up again.

No, this will almost certainly be accompanied by (cause-effect...who knows?) a credit squeeze. When the crash takes its toll, just try and get anything over a 3x mortgage....or self-cert!!.

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You will be out of a job, your savings will be worth less and general recession before house prices crash :) the price of a house will be the least of your worries.

At least the playing fields will have been leveled. :rolleyes:

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To those that have smugly watched and cheered as their properties values rose, and to the BTlers who have exacerbated the situation... if they lose their jobs - tough sh1t.

Yes - When the crash comes I'll be the first to mock the BTL's who greedily snaped up properties at the top of the market. I'll also smirk as they're evicted from the Homes they used as security to buy them. From Landlord to DSS Tennant in one easy move :lol:

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Finally here is some food for thought - if 20-40% of the property market is priced out FTB's who are just sitting, waiting and saving and there IS a crash - surely it would only last as long as it takes for those thousands who are just waiting for the moment to pounce, and demand would be so strong from new buyers that HPI would just begin to stabilise straight away and prices would probably bounce back up again.

funnily enough, apparently house prices crashed once before.

What happened then?

:D

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It isn't necessarily the housing crash that many need worry about. When my father and myself lost our jobs in the worst construction industry recession since the 30's it wasn't the mortgage that was the problem, it was the inability to make a living. Take that away and it makes no difference how big the mortgage is.

Many have been smug and stupid in the last 10 years. However, I am not sadistic enough to delight in other peoples misery.

Maybe I'm F*cked up.

If you are then I am too. Last time around my mother was out of work for 5 years. It was utterly soul destroying. She has never bought a house, never been in a position to. There are plenty more like her. When the recession hit it wasn't just smug property owners who had the smiles wiped off their face. Should it happen tomorrow many of those smug gits will ride it out - they might have to make cut backs but they won't run out of electricity 3 days before the dole cheque arrives. It's the never-have-had-muches that get shafted when things go wrong. I'm not about to wish for a recession so that houses get cheaper - it just ain't worth it. Besides, house prices can plummet 70% - if you lose your job in the meltdown you're not going to buy.

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From Landlord to DSS Tennant to bankrupt in one not so easy move

Expect the difficult bit would be turning into a can of lager

You will be out of a job, your savings will be worth less and general recession before house prices crash :) the price of a house will be the least of your worries.

There is truth in this. Be careful what you wish for

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There is truth in this. Be careful what you wish for

Wishing doesn't cause a bust, the boom causes the bust.

The boom is when all the damage takes place, later is just when it's being paid for. It is sad that many of those paying are not those who were able to benefit to begin with.

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That sounds fantastic to me! Give me a couple of years sharp pain over 25 years of outdrawn misery any time!

A recession is temporary, the debt if you take on a house today lasts for 25 years (assuming you don't go for I/O, of course, in which case it lasts forever).

Depends what age you are when dumped on the scrap heap?

I’ve known people that have never recovered their careers.

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OK FIRST THING FIRST!

I hate to see anyone lose their jobs but specuilators losing money? I would laugh until my sides burst.

Those who have bough on I/O over the past 4 years - Im sorry but you are the first to go! Anyone that gets a mortgage thats right at the top end of their affordability when rates are generally low, and then does not consider a rates rise is STUPID imho. It is wreckless on their behalf and although I would NOT celebrate - I certainly would not have pity.

Being out of work is hard, but call me cynical here. You have worked for years and paid taxes. SPONGE OFF THE DOLE IF YOU CANT GET A JOB! Its your money!!!! There is NO stigma to Social Benefits in a recession. YOU out of all the people DESERVE your 2 weekly cheque.

I think the lessson of PROPERTY DOES GO DOWN will affect a LOT of people and I honestly believe that when it goes down CONSTANTLY 1% MoM as Bubb says - there will be a MASS EXODUS. Those who think - picking up a bargain? Unless you have cash you have no chance coz the banks will borrow you DIDDLY SQUAT! CASH IS KING is a recession. Speculators can not use other properties as guarantee's. The banks wanna see risk from the buyers.

What ever happens - happens. But there will be alot of people in financial difficulties becuase of their own STUPIDITY and BLINKERED EYES. Just dont feel guilty If you buy a repo - it was NOT YOUR FAULT!

TB

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I was discussing the building boom in Ireland with my Dad a few weeks ago, he's currently 63 years old and has job agencies constantly calling him with job offers all the time. (I hope I'm that fortunate if I get to that age). He has always worked in the building trade; England in the 60's/70's before returning to Ireland in the late 70's to setup his own construction business. Unfortunately in the early '80s an oil crisis triggered an economic collapse in the Irish republic (coupled with out of control govermnent spending and massive personal taxes, high inflation and high interest rates) which meant the banks rolled up their loans and Dad could not get paid for any work outstanding plus all work dried up. He had also taken out a loan of IR£2,000 from AIB bank at the time, to finance the start of a new construction project.

Suddenly all cash stopped flowing.

Interest rates went to double-digit figures.

The cost of living rose substantially.

He had a young family to look after (4 children).

AIB bank got vicious and sent threatening letters every week looking for the loan back, and would not bargain.

This also put huge strain on his marraige. (I remember the rows)

On Christmas Eve '82 and again '83 he only had IR£5 in his pocket.

His business went broke and folded.

Anyway to cut a long story short, The area he lives in has a good community & family network and there is always work for a good tradesman or people willing to work (not that he had much choice), so he was able to survive (not profit).

He eventually paid off the loan with AIB and immediately closed his account with them.

A lot of other people in Ireland were not so fortunate and had to emmigrate to the USA or England to find work, this had a decimating effect on communities, schools had to close because the children were not there, parishes could no longer field football or hurling teams. It got so bad that by 1987 when I was sitting my Inter cert exams, the standard joke was "would the last person to leave the country please turn out the light".

There will be another bust in Ireland, in the same timescales as the USA and UK, and a lot of young families will find themselves in the situation my dad did in the 1980's. This will be nasty as the emmigration safety valve will likely not be there this time.

Our shame is there was no need for HPI to get to this scale in Ireland and the blame can be squarely placed at a section of the politicians and councillors who took bribes during the 80's for land rezoning, did not adequately plan for the changing demographics and vested interest groups such as an Taisce (equivalent to the CPRE) and the Georgian society who opposed high rise building and other forward planning in Dublin. Added to that the social pressure created by the older generation to get on the ladder.

There will be a lot of anger released when the blinkers are removed from my generations eye's and we experience mass unemployment for the first time. That period in the 80's was rough on my Dad both financially and mentally, and it has stuck to this day. He's hoping to retire in two years, we both reckon the boom will be coming to an end by then, so make hay while the sun shines.

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If House Prices came down to sensible levels, I would feel total elation. It would be a wondrous moment where everybody could be judged on what they do for their fellow man rather than what they own.

Edited by The Dude

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Sad thing is a lot of people on this site will have friends and relatives who are recent first time buyers and overstretched themselves just to get on the ladder.

They will suffer the most after any crash yet probably deserve to do so the least! My sister is about to become one of them but I have given up trying to persuade her not to buy.

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  • 302 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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