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What Do People Do ..........

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They:

(1) Take in a lodger

(2) Rent out their second home

(3) Move to a smaller house

(4) Take a job abroad

With this latest interest rate rise, I am hoping to see more (and therefore cheaper) rents.

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They also reduce their non-essential spending by:

- buying less

- going out less

- travelling less

This depressed consumer spending leads to job losses, followed by sharp fall in consumer confidence which then leads to further reduction in spending. A real vicious cycle !!!

Oops, I forgot to mention what would happen to house prices ....... :P

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They:

(1) Take in a lodger

(2) Rent out their second home

(3) Move to a smaller house

(4) Take a job abroad

With this latest interest rate rise, I am hoping to see more (and therefore cheaper) rents.

They also

a Cut back on things that aren't necessary like eating out, take aways, movies, shows etc

b And also get a second part-time job.

Unfortunately because of a there is less chance of b.

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they find out who really owns the property when they get repossessed

Edited by dnd

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Guest d23
They:

(1) Take in a lodger

(2) Rent out their second home

(3) Move to a smaller house

(4) Take a job abroad

With this latest interest rate rise, I am hoping to see more (and therefore cheaper) rents.

I'm anticipating house prices to fall as a result of IR hikes but not sure rents are going to drop; I'm expecting to carry on renting at around the same level (or slightly higher) until such a time as I can reasonably afford to buy

they didn't drop last time and not sure why they would this time round

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MEW is not an option when negative equity comes calling.

They sell the house at a loss, along with the X5 and the 60" Plasma. :rolleyes:

Edited by Wait & See

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I'm anticipating house prices to fall as a result of IR hikes but not sure rents are going to drop; I'm expecting to carry on renting at around the same level (or slightly higher) until such a time as I can reasonably afford to buy

they didn't drop last time and not sure why they would this time round

I wondered about this, but then the rental market has changed dramatically over the past 10 years. Ten years ago, there were places and times when rental properties were in very short supply. The private renter found him/herself competing with companies and councils when looking for properties to rent. There market is now a surplus of rental property on the market.

You might be right but I suspect that rents may be squeezed as more people are forced to rent out their homes or part of their homes.

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I'm anticipating house prices to fall as a result of IR hikes but not sure rents are going to drop; I'm expecting to carry on renting at around the same level (or slightly higher) until such a time as I can reasonably afford to buy

they didn't drop last time and not sure why they would this time round

The question of what's going to happen with rents is a good one. I guess it depends on the supply/demand balance with tenants and btlers. While houses might not drop much, btlers with empty flats they can't sell might have to cut their rents to prevent voids - in which case they'll compete the rents down. If a recession goes with falling immigration, and perhaps even people going back to their home country, homeowners taking in lodgers, peeps moving back in with parents, falling numbers of university students and a higher number staying at their parents to study locally, then rents might well come down.

Will be interesting to see.

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You might be right but I suspect that rents may be squeezed as more people are forced to rent out their homes or part of their homes.

And don't forget all these empty BTL urban apartments - I can see rents in those only going one way and that's down (although it might be even cheaper to buy a repo in a couple of years time :lol: )

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Guest d23
I wondered about this, but then the rental market has changed dramatically over the past 10 years. Ten years ago, there were places and times when rental properties were in very short supply. The private renter found him/herself competing with companies and councils when looking for properties to rent. There market is now a surplus of rental property on the market.

You might be right but I suspect that rents may be squeezed as more people are forced to rent out their homes or part of their homes.

I hope you're right but theres at least 3 million more people in the UK than there was in the last crash and I'm pretty sure nothing like 3 million new properties have been built.

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I hope you're right but theres at least 3 million more people in the UK than there was in the last crash and I'm pretty sure nothing like 3 million new properties have been built.

Is that figure right? Admittedly we have had a flood of East Europeans arriving but we have also got a shinking domestic population and rising emigration.

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MEW is not an option when negative equity comes calling.

They sell the house at a loss, along with the X5 and the 60" Plasma. :rolleyes:

...and hopefully they won't be able to buy until it's expensive again.

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Is that figure right? Admittedly we have had a flood of East Europeans arriving but we have also got a shinking domestic population and rising emigration.

I didn't think it was that high either. However, one point to consider is that the house building figures are quoted in terms of individual units rather than number of people accommodated. Over the last 5 years a conservative estimate is that 750,000 new units have been built which, again taking a low number, could house around 1.5M people. Even allowing for slum clearances in the north (mostly of houses that were empty anyway), that's a lot of new capacity even compared to the number of people moving into the country (and don't forget the significant numbers leaving to move to Spain and elsewhere to retire). I personally think the shortage of supply argument for booming prices has been overdone.

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Guest d23
Is that figure right? Admittedly we have had a flood of East Europeans arriving but we have also got a shinking domestic population and rising emigration.

ONS link

those projections look pretty scary.......

I don't think there is a drastic, urgent shortage of properties in the UK but I don't think theres a huge amount more rental opportunities available than there was in the last crash; I'm not expecting a drop in rents (probably a rise if anything) but I get on OK with my current landlord who's in a good position to weather any crash so I guess I'll just try and sit tight until it's time to buy.

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They:

(1) Take in a lodger

(2) Rent out their second home

(3) Move to a smaller house

(4) Take a job abroad

With this latest interest rate rise, I am hoping to see more (and therefore cheaper) rents.

Or they could, move to the smaller house abroad, with a lodger and rent out the house in the UK. :)

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I hedge the rise by backing it on betfair. So far my winnings have covered the last 3 months worth of rises

good thinking ;) what about shorting realestate on a spread bet site?

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ONS link

those projections look pretty scary.......

I don't think there is a drastic, urgent shortage of properties in the UK but I don't think theres a huge amount more rental opportunities available than there was in the last crash; I'm not expecting a drop in rents (probably a rise if anything) but I get on OK with my current landlord who's in a good position to weather any crash so I guess I'll just try and sit tight until it's time to buy.

I take your point on the past population rise. The only caveat I would put on this is that the government are pretty clueless about how many people enter or leave the country. As far as future projections go, these will only come true if the government make them self fulfilling (i.e. lets another 5 million immigrants in). If they do that, I think there is a risk of social unrest.

I have to disagree with you on the rental outlook. I have never seen more choice of rental property and it seems to be growing all the time.

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[...]

I have to disagree with you on the rental outlook. I have never seen more choice of rental property and it seems to be growing all the time.

I suppose this would depend on where you live?

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