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goldeneye977

Is A Hpc Just Wishful Thinking?

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Hi Guys,

Like many people on this board, I am also looking to buy my first home but am paralyzed by the way prices have shot up. I cannot afford the house that I like, and can only afford menial houses from what I earn, which I guess is what most of the people on this board face.

Note that I live in Seattle, WA. The US market is showing signs of cooling, but not here in Seattle where prices rose 16% in the first 7 months. The main press is awash with stories of the impending doom but I think they just say that for the sake of sensationalizing news (after all bad news sells fast). Saner economists predict a maximum of 5% decline nationally and that too in several years. A 5% decline is not going to do me and many like me any good.

The reason I am interested in the British/Australian property markets is because these markets are very similar to US' and they are ahead of the US. Recently MSN published an article about the British housing and claimed that there are many macroeconomic factors favoring the British housing (such as the growth of 35,000 households every year in London for the next decade or so etc). Barring a few incidents in Sydney, the Australian market is pretty strong too and shows no signs of easing. Some markets are recording 20% YOY.

This makes me come to an uncomfortable conclusion: Are these higher prices here to stay? I find it extremely hard to believe that prices can continue like this forever but right now it seems impossible to believe that prices will actually drop to where they were a couple of years ago. If that is so, could we be wasting our time, waiting for the HPC to happen when it may never happen? Or should we swallow the bitter pill and plunge in the market and take whatever we get?

Most of the threads that I have read on this forum were merely wishful thinking and were not substantiated with facts. In fact when results are published by NationWide etc, showing that HPI is growing, people of this forum suspect foul play. I am sure that these companies have their own vested interests in showing glowing results, but all of it can't be untrue, can it?

I am just a confused FTB seeking advice.

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Hi Guys,

Like many people on this board, I am also looking to buy my first home but am paralyzed by the way prices have shot up. I cannot afford the house that I like.

....

I am just a confused FTB seeking advice.

Not many first time buyers can afford a house they like.

Most first time buyers will get a shit heap for their first place and then trade up later :)

Wether you are prepared to wait for a house price crash is your choice, but dont wait because you cant afford a nice house for your first purchase.

Edited by zag2me

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Wether you are prepared to wait for a house price crash is your choice, but dont wait because you cant afford a nice house for your first purchase.

How about renting, these days the landlord even subsidises you :D

Its great, they pay 5-7% of the properties value and you pay 4-6%.

When somethings broke they come to fix it and if you get fed up of the area or landlord just move elsewhere.

No hassle no fees.

GoldenEye - If your in the US with stories like this arent you better waiting a little longer to see if momentum builds on the slippery slope?

http://www.thebusinessonline.com/Stories.a...88-E1AC85BF7FDF

Every year at work we have a weekly get together with the yanks - Last year lots of talk about real estate, not a peep this year...

Edited by DONT PANIC !!! DONT PANIC !!!

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How about renting, these days the landlord even subsidises you :D

Its great, they pay 5-7% of the properties value and you pay 4-6%.

When somethings broke they come to fix it and if you get fed up of the area or landlord just move elsewhere.

No hassle no fees.

If your in the US with stories like this arent you better waiting a little longer to see if momentum builds on the slippery slope?

http://www.thebusinessonline.com/Stories.a...88-E1AC85BF7FDF

All the fundamentals are their for a HPC, My guess is a rapid slowdown in the housing market next year. One also has to look at geopolotics, any major problem with Iran (sanctions) will push the price of energy (Gas, Oil) through the roof.

Massive amounts of consumer debt mixed in with huge real term costs for energy during winter 2006/2007 will cause UK economic growth to slow to a trickle, raising unemployment tipping more people over the edge of the cliff!

I't could get really ugly, i think!

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NO and i'll say it again NO! it is not wishful thinking.

It WILL happen as sure as night follows day, as sure as death will become you and as sure as taxes will consume you.

When neuton first threw that apple into the air did he have any doubt, any suspicion that the apple would fall not back to the ground.. NO. Why was neuton so sure? He spent years understanding the science of gravity and predicted correctly that the apple would fall back.

Look at the science of economics and the boom in house prices. The science of economics tells us that house prices WILL come back down from their silly heights. Keep the faith, and if you are too apprehensive or have lost faith do what you want, jump into the housing market I couldn't care less but in my opinion and many true pure economists out there - at your peril and ignorant misfortune it will be.

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42% off in Sydney, and the party has only just started...

http://www.smh.com.au/news/national/housin...6012414995.html

This has been the biggest housing bubble in history, and it will very likely be the biggest bust in history.

Buying now is just complete madness.

top find.....

Given it has been 16 years since the last recession, long-time estate agents fear the fate of a generation of owners who had not experienced having a loan when times were tough.

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NO and i'll say it again NO! it is not wishful thinking.

It WILL happen as sure as night follows day, as sure as death will become you and as sure as taxes will consume you.

When neuton first threw that apple into the air did he have any doubt, any suspicion that the apple would fall not back to the ground.. NO. Why was neuton so sure? He spent years understanding the science of gravity and predicted correctly that the apple would fall back.

Look at the science of economics and the boom in house prices. The science of economics tells us that house prices WILL come back down from their silly heights. Keep the faith, and if you are too apprehensive or have lost faith do what you want, jump into the housing market I couldn't care less but in my opinion and many true pure economists out there - at your peril and ignorant misfortune it will be.

I agree entirely its just damned hard getting the timing right :(

The economics have been telling us the prices will come down for at least the last 3 years.

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Hi Guys,

Like many people on this board, I am also looking to buy my first home but am paralyzed by the way prices have shot up. I cannot afford the house that I like, and can only afford menial houses from what I earn, which I guess is what most of the people on this board face.

Note that I live in Seattle, WA. The US market is showing signs of cooling, but not here in Seattle where prices rose 16% in the first 7 months. The main press is awash with stories of the impending doom but I think they just say that for the sake of sensationalizing news (after all bad news sells fast). Saner economists predict a maximum of 5% decline nationally and that too in several years. A 5% decline is not going to do me and many like me any good.

The reason I am interested in the British/Australian property markets is because these markets are very similar to US' and they are ahead of the US. Recently MSN published an article about the British housing and claimed that there are many macroeconomic factors favoring the British housing (such as the growth of 35,000 households every year in London for the next decade or so etc). Barring a few incidents in Sydney, the Australian market is pretty strong too and shows no signs of easing. Some markets are recording 20% YOY.

This makes me come to an uncomfortable conclusion: Are these higher prices here to stay? I find it extremely hard to believe that prices can continue like this forever but right now it seems impossible to believe that prices will actually drop to where they were a couple of years ago. If that is so, could we be wasting our time, waiting for the HPC to happen when it may never happen? Or should we swallow the bitter pill and plunge in the market and take whatever we get?

Most of the threads that I have read on this forum were merely wishful thinking and were not substantiated with facts. In fact when results are published by NationWide etc, showing that HPI is growing, people of this forum suspect foul play. I am sure that these companies have their own vested interests in showing glowing results, but all of it can't be untrue, can it?

I am just a confused FTB seeking advice.

US markets similar to the UK? Are you serious?

UK house, 6 bedrooms, 3/4 acre, £1.4m

US house, 6 bedrooms, 1/2 acre, £0.2m

When compared to the UK market, US houses are practically being given away.

Edited by dog

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I agree entirely its just damned hard getting the timing right :(

The economics have been telling us the prices will come down for at least the last 3 years.

DPDP - Yes it has been a long time coming but also remember the housing 14 year cycle it's never quick. The pickup started in 1996/97 but the true boom did not start till 2000 after the dot com crash. 2007 makes it mid term where houses should start to plateua for a little while then start the downward slope. It has been drawn out longer this time due to outside global economics like chindia and the yen carry trade and America's Alan Greenspan super low rates and labour ambition to stay in power so the needed correction was delayed through easy economic policy so prolongued any correction to stay in power deciding to play the 'now' instead of the long term.

There are so many outside global factors that have influenced this housing market and prolongues it, extending it. The idiots that predicted it in 2003/2004 used the traditional 7/14 year cycle in housing, thinking it started in 1996 so it should start dropping in 2003, they DID NOT take into account macro economics which is the major influencer right now.

The Macro economics (which has delayed it) is now under extreme pressure - the devil has curled his upper lip and his snarl is there for all to see now - beware and be strong, ride the wave we are almost there. Beware though the bottom may not be seen till 2014 before the next upturn. The plus side is that the first 2/3 years are the steepest declines so sit tight till 2008/2009 or think about offering 10/20% odd below asking when the downturn has been in action for a year or so - end 2007 start 2008.

As I have always said Keep the faith!!.

IMO if you want to make some easy money while you wait expose 20 - 40% of your cash into silver and gold you will not be sorry you did so.

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No I do not think it is wishful thinking. It is extremely likely. How and when is the tricky question.

Many people on this site (and many more not on this site) are interested in housing prices becoming more reasonable but that's not wishful thinking as wishful thinking suggests an anticipated outcome that is extremely unlikely.

It's pretty simple really, take a look at the graph on this site's homepage (or any graphs that detail share prices, house prices etc), they peak and trough. There is absolutely no evidence whatsover that the upward climb that started in the mid 1990s will continue forever and a lot of evidence stacking to suggest the opposite is likely.

I am about to start renting as I am selling my property which I have owned for 13 years. The rent is going to cost me almost triple what my mortage was costing me but I think it's worth it. I believe we are moving into a potentially explosive period in our economic history for a number of reasons such as the end of a boom period, world economy/politics/terrorism running out of control and impossible levels of debt in the UK. No-one can predict what will happen if the tide starts to turn but I personally think it will be unprecedented in it's scale. There are a huge number of people in the UK who have been living high on the hog and are going to have to start paying for it soon.

Sit tight, even for a year or two, is my message. But good luck with whatever you choose to do.

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I imagine you had a lot of equity.

Yes, a reasonable amount.

Unfortunately I'm not a fan of moving home, if I had moved up the ladder 6 or 7 years ago I really would be laughing now but I didn't get round to it. Also I'm moving out of London to the South West so that'll help but having said that, the worst thing for me is contemplating current prices because they are shocking. On principal I don't want to feel as though I am getting ripped off but of course things may not go as I expect and I could end up with egg on my face if prices continue to climb (even if at a more realistic rate).

It's a flaming rollercoaster.

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Maybe that's where I'm going wrong as a FTBer? When I look at the dross sent to me by the local EA's I'm flicking through reams of overpriced bedsits, tiny studio flats, crapholes over betting shops and battery hen "executive apartments".

For the pleasure of owning one of the above I'm expected to hand over a big chunk of cash as a deposit then direct debit a fair amount of my wages every month for the pleasure of living somewhere I know I don't like. Is this wrong? Should I just suck it in and buy anything just to get into property?

All I'm bothered about is getting good value for my money and the ongoing commitment. If there is a HPC the bull$hit will strip away and people will laugh at you if you paid a small fortune for a $hitty but "spacious" flat above William Hill.

I believe that the FTBer market is a dangerous place to buy into- all the pressure to "get on the ladder" could trick you into buying a lemon that you won't be able to give away if and when the market gets back to some sense.

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Not many first time buyers can afford a house they like.

Most first time buyers will get a shit heap for their first place and then trade up later :)

Wether you are prepared to wait for a house price crash is your choice, but dont wait because you cant afford a nice house for your first purchase.

Problem is for many FTB is that they need 2 or 3 bedrooms if they plan on starting a family. Will be difficult to trade up once the babies arrive.

Trade up from a shoe box costing 1/4 million. Yes that's right a cool 1/4 million pounds sterling. Note that I am not using that loose term of '250' which we seem to use these days. Sounds quite different doesn't it? Do you know what the mortgage payments are on 250 aka 1/4 M at 5% over 25 years? I didn't think so. £1478. That's more than many earn.

Many FTB's simply can not afford to buy. Where do you suggest they get the rest of the money? What, from the moneytree???

Edited by Buffer Bear

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Maybe that's where I'm going wrong as a FTBer? When I look at the dross sent to me by the local EA's I'm flicking through reams of overpriced bedsits, tiny studio flats, crapholes over betting shops and battery hen "executive apartments".

For the pleasure of owning one of the above I'm expected to hand over a big chunk of cash as a deposit then direct debit a fair amount of my wages every month for the pleasure of living somewhere I know I don't like. Is this wrong? Should I just suck it in and buy anything just to get into property?

All I'm bothered about is getting good value for my money and the ongoing commitment. If there is a HPC the bull$hit will strip away and people will laugh at you if you paid a small fortune for a $hitty but "spacious" flat above William Hill.

I believe that the FTBer market is a dangerous place to buy into- all the pressure to "get on the ladder" could trick you into buying a lemon that you won't be able to give away if and when the market gets back to some sense.

I remember the last HPC and it was exactly the same situation as now (without the internet!). The vast majority of people were scrabbling over each other to get onto the housing ladder at any cost. You could almost hear the mantra being subconsciously chanted everywhere you went "If I don't get on the ladder now I never will, If I don't get on the ladder now I never will'.

At the time, I rented a room from a friend who bought right at the peak. The only reason she could afford it was because her dad shared the cost with her. Within a couple of years they were in negative equity and it took several more years before she was able to sell at a reasonable rate.

It surprises me that so many parents are now helping their children onto the housing market as I always think, 'don't you remember the last time?' Maybe they do, maybe they think this time it's different, maybe it is. I don't think it is though but only time will tell.

I do feel sorry for any FTB-ers who are trying to get their own place. It must be absolute hell, seeing how far they are from reasonable housing or how much they need to pay for unreasonable housing. However, the bottom line is only mugs buy at the top of the market (houses, shares, precious metals, Take That records) and personally this looks very toppy to me.

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I remember the last HPC and it was exactly the same situation as now (without the internet!). The vast majority of people were scrabbling over each other to get onto the housing ladder at any cost. You could almost hear the mantra being subconsciously chanted everywhere you went "If I don't get on the ladder now I never will, If I don't get on the ladder now I never will'.

At the time, I rented a room from a friend who bought right at the peak. The only reason she could afford it was because her dad shared the cost with her. Within a couple of years they were in negative equity and it took several more years before she was able to sell at a reasonable rate.

It surprises me that so many parents are now helping their children onto the housing market as I always think, 'don't you remember the last time?' Maybe they do, maybe they think this time it's different, maybe it is. I don't think it is though but only time will tell.

I do feel sorry for any FTB-ers who are trying to get their own place. It must be absolute hell, seeing how far they are from reasonable housing or how much they need to pay for unreasonable housing. However, the bottom line is only mugs buy at the top of the market (houses, shares, precious metals, Take That records) and personally this looks very toppy to me.

As you mentioned PM's - Do you think precious metals have reached their top?

And if so.. why?

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Hi Guys,

Like many people on this board, I am also looking to buy my first home but am paralyzed by the way prices have shot up. I cannot afford the house that I like, and can only afford menial houses from what I earn, which I guess is what most of the people on this board face.

Note that I live in Seattle, WA. The US market is showing signs of cooling, but not here in Seattle where prices rose 16% in the first 7 months. The main press is awash with stories of the impending doom but I think they just say that for the sake of sensationalizing news (after all bad news sells fast). Saner economists predict a maximum of 5% decline nationally and that too in several years. A 5% decline is not going to do me and many like me any good.

The reason I am interested in the British/Australian property markets is because these markets are very similar to US' and they are ahead of the US. Recently MSN published an article about the British housing and claimed that there are many macroeconomic factors favoring the British housing (such as the growth of 35,000 households every year in London for the next decade or so etc). Barring a few incidents in Sydney, the Australian market is pretty strong too and shows no signs of easing. Some markets are recording 20% YOY.

This makes me come to an uncomfortable conclusion: Are these higher prices here to stay? I find it extremely hard to believe that prices can continue like this forever but right now it seems impossible to believe that prices will actually drop to where they were a couple of years ago. If that is so, could we be wasting our time, waiting for the HPC to happen when it may never happen? Or should we swallow the bitter pill and plunge in the market and take whatever we get?

Most of the threads that I have read on this forum were merely wishful thinking and were not substantiated with facts. In fact when results are published by NationWide etc, showing that HPI is growing, people of this forum suspect foul play. I am sure that these companies have their own vested interests in showing glowing results, but all of it can't be untrue, can it?

I am just a confused FTB seeking advice.

The fact is nobody knows when, there are no rules I was in the UK in the late 80s early 90s nobody really foresaw a crash, even then we only really talked about it as being a crash after it happened. Even in 1990 it was recommended a good time to buy when we had a slight pullback and the majority believed property would go back up, if you don't buy now you never will be able to afford it . The peak hit was 1988 when there was a mad rush because of new tax laws were coming in . With a comination of interest rate rises (they were 8 % in 1990 and that was considered not too bad) and a recession , they were high mortgagee sales and no buyers so property plummeted through the earlly 90s . Even lowering interest rates had no effect as the housing sector had lost total confidence, once the fall starts it keeps going as noone knew how far they would drop. Banks were just giving away houses as people who were in arrears were disappearing abd doing runners.

Basically once the buyers stop turning up anything can happen as we are seeing in certain parts of West Sydney. A house that was bought for 450 K in 2003 was sold for 285 K at a morgagee auction a drop pf around 40 %, with one person turning up at the auction, so we are just beginning to see how things are inflated.. So who knows . We have gone through the period of the panic buyers and now we will start to see the panic sellers. This is a reverse of the boom psychology (GREED) where owners want top dollar and the price and more of the last one sold to the went things start going down and FEAR sets in as the seller is watching a drooping asset and no one to bail him/her out. Its like we knew the Tech Boom would crash at some point but we never knew when.

Theres a great saying during the 1929 Wall Street Crash, when the shoe shiner is recommending stock "its time to get out"

Recommendation shop around and you will find a bargain. They don't come to you. You will find a desperate seller we are in that season as they are now thinking its time to bail.

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HPC already started in the USA and Australia. In 28 from 51 states the prices are declining, in many states sellers now offer cars, flat sreeens and so on - so in reality prices are even lower than official ones.

Several months and we will have worldwide HPC, when recession will strike (consumer spending in the USA can drop up to 40% with HPC...this means global recession).

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Hi Guys,

Like many people on this board, I am also looking to buy my first home but am paralyzed by the way prices have shot up. I cannot afford the house that I like, and can only afford menial houses from what I earn, which I guess is what most of the people on this board face.

Note that I live in Seattle, WA. The US market is showing signs of cooling, but not here in Seattle where prices rose 16% in the first 7 months. The main press is awash with stories of the impending doom but I think they just say that for the sake of sensationalizing news (after all bad news sells fast). Saner economists predict a maximum of 5% decline nationally and that too in several years. A 5% decline is not going to do me and many like me any good.

The reason I am interested in the British/Australian property markets is because these markets are very similar to US' and they are ahead of the US. Recently MSN published an article about the British housing and claimed that there are many macroeconomic factors favoring the British housing (such as the growth of 35,000 households every year in London for the next decade or so etc). Barring a few incidents in Sydney, the Australian market is pretty strong too and shows no signs of easing. Some markets are recording 20% YOY.

This makes me come to an uncomfortable conclusion: Are these higher prices here to stay? I find it extremely hard to believe that prices can continue like this forever but right now it seems impossible to believe that prices will actually drop to where they were a couple of years ago. If that is so, could we be wasting our time, waiting for the HPC to happen when it may never happen? Or should we swallow the bitter pill and plunge in the market and take whatever we get?

Most of the threads that I have read on this forum were merely wishful thinking and were not substantiated with facts. In fact when results are published by NationWide etc, showing that HPI is growing, people of this forum suspect foul play. I am sure that these companies have their own vested interests in showing glowing results, but all of it can't be untrue, can it?

I am just a confused FTB seeking advice.

What anwer are you seriously expecting from a site called housepricecrash :)

For what it is worth my opinion is that every bit of commonsence in my body tells me that this Bull run will end in a crash, and it should of done two years ago. And then there is that something else inside of me that says what the hell is going on. how is this thing holding up.

All i can say is do your own research, do not use this site only.

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Not many first time buyers can afford a house they like.

Most first time buyers will get a shit heap for their first place and then trade up later :)

Wether you are prepared to wait for a house price crash is your choice, but dont wait because you cant afford a nice house for your first purchase.

The trouble is the goalpost have been moved out of the ground. If I'd be born five years previously and had starting in the same kind of job post-uni I could have bought a one bedroom flat straight away. Being born at the wrong time I couldn't even rent a one bed flat so had to live in a shared house worse than any I had as a student for several years.

Now as a fully paid up member of the DINKY brigade and five years older a one bed flat is completely pointless. Our rented tiny two bed (no space bigger than 10'x10' and most smaller) is really too small to really organise our modest amount of stuff.

Even if we bought a place like this, sinking all our savings in, the mortgage would still be getting on for £300 than we pay in rent and as mortgages are so front loaded for the first few years it's hardly worth the money. Especially as we'd take no pride or pleasure in it.

I really hate renting with passion but I know buying any old junk just now won't make me feel any better at all.

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The trouble is the goalpost have been moved out of the ground. If I'd be born five years previously and had starting in the same kind of job post-uni I could have bought a one bedroom flat straight away. Being born at the wrong time I couldn't even rent a one bed flat so had to live in a shared house worse than any I had as a student for several years.

Now as a fully paid up member of the DINKY brigade and five years older a one bed flat is completely pointless. Our rented tiny two bed (no space bigger than 10'x10' and most smaller) is really too small to really organise our modest amount of stuff.

Even if we bought a place like this, sinking all our savings in, the mortgage would still be getting on for £300 than we pay in rent and as mortgages are so front loaded for the first few years it's hardly worth the money. Especially as we'd take no pride or pleasure in it.

I really hate renting with passion but I know buying any old junk just now won't make me feel any better at all.

I really understand what you on about here. I live in a cheaper area in middlesbrough, teesside. We bought my property in cash for 29k a few years ago.. and it is now worth 70k and rising. I have been looking around at properties because my place is just too small for my 2 children.. who have to share a room.. and we are overcrowded with clutter.. which to be honest.. is only the hoover.. a modest amount of toys, and clothes.. (my husband keeps his at his mothers)..

we have been looking for properties and although my husband's job is secure.. I just cannot picture myself living in some of them on his wages.. next to taxi drivers.. and people who are not even educated. He's 34 years old.. and while we are lucky to already own a place.. I really feel sad that on his good wages we are stuck with a shit hole a single person just starting out.. should be privy too.. not us.. Not at this stage of our lives and not after years of saving too.

Hang in there dear..

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Not many first time buyers can afford a house they like.

Most first time buyers will get a shit heap for their first place and then trade up later :)

Wether you are prepared to wait for a house price crash is your choice, but dont wait because you cant afford a nice house for your first purchase.

True but....

In the past the average FTB was aged in their mid twenties, new to the labour market and a relatively low earner (compared to expectations later in life). Nowadays the average FTB is aged 34, typically on an above average income and approaching their peak career earnings.

In the past higher inflation meant that mortgages were paid off at a much faster rate, so that within 10 years the property would be pretty much owned outright. Nowadays low inflation makes a mortgage a much longer term committment.

So the point that FTB's in the past always had to put up with S*** heaps doesn't hold up to scruitiny when FTB's and the economy as a whole have changed. Today's FTB is also likely to be a LTB (last time buyer).

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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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