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roblpm

Uber Bear News All Very Well

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I live in Edinburgh. Been on HPC for about 3 years. Didn't buy in winter of 2005, prices now up about 40% on then. (and that is sold prices, not asking prices).

So my question is how long til prices return to levels of 3 years ago??

And also................ Used to be talk about the indexes which have now disappeared under the wieght of global financial meltdown.

Anyone care to update when Halifax, Nationwide, FT, Land Registry etc will go negative YoY?

Registers of Scotland 10.7% annual increase on last press release.

So its all very well but how long til I can afford to buy a house!!!! Not convinced I shouldn't have bought a couple of years ago!!

Edited by roblpm

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These things take time to feed through to the sheeple, HPC is defo inc, but 6-24 months to reach 2003 levels, unless you are buying new build city center flat at auction! Because they are only about 3 months off 2003 prices.

However you are gunna need a decent deposit to get a loan to buy one. '<- 100% Gte'd'

Edited by Yoss

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I live in Edinburgh. Been on HPC for about 3 years. Didn't buy in winter of 2005, prices now up about 40% on then. (and that is sold prices, not asking prices).

Says who?

Even a quite localised 40% in the space of two and a bit years is stretching credibility rather thin, even in 2006. Prices have barely moved up nationally in the last 6-9 months.

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2008-01-11 67 Comiston Drive, Edinburgh, EH10 5QS £645,000

2006-04-03 67 Comiston Drive, Edinburgh, EH10 5QS £450,000

Same house. No Improvements. Many others!!

Maybe not an average of 40% but definitely a lot in the good areas!

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2003-08-01 35 Comiston Drive, Edinburgh, EH10 5QS £464,868

2007-12-17 35 Comiston Drive, Edinburgh, EH10 5QS £650,000

Don't know about improvements and was 2003 so maybe I am wrong!! But still much more expensive!!

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2008-01-11 67 Comiston Drive, Edinburgh, EH10 5QS £645,000

2006-04-03 67 Comiston Drive, Edinburgh, EH10 5QS £450,000

Same house. No Improvements. Many others!!

Maybe not an average of 40% but definitely a lot in the good areas!

If I was a troll, I would have waited until I had one example of a 40% rise before making my move.

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Halifax and Nationwide go YoY negative in May (possibly even April, but definitely May) based on very clear statistical analsys previously posted on this forum.

Patience, young Skywalker.

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Thanks paddles.

Got a link to the statistical analysis?? To cheer me up??

Actually you already cheered me up by calling me young!!

Edited by roblpm

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Just seen a few 10 and 15% cuts in asking prices in the area i'm looking at.

148K for a 3 bedroom semi with garage is hugely tempting.

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To Quote Yoda, "You must unlearn what you have learned" = House prices only ever go up

= Bollards especially when you factor in speculators (AKA BTL)

"The time will come when you must face Vader!" But not yet! :lol:

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The real issue going forward is whether prices stagnate or come back to 2004/2005 levels.

I cant see them dropping that far without a major increase in unemployment or Interest rates, both of which are very low right now by historical standards.

My plan is to wait a few more months and hopefully i can pick up a better deal or to buy something in the Auction.

All the bad news you could possibly think of has been thrown at this market and prices are only down by 0.4 or 0.6 per month. This doesn't look like a market thats going to crash.

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Fear is the path to the dark side. Fear leads to anger. Anger leads to hate. Hate leads to suffering.

Yup but not wanting to sound GF or Cgnao ish about it, but hold fast, 'Strange things are afoot at the Circle K'

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I live in Edinburgh. Been on HPC for about 3 years. Didn't buy in winter of 2005, prices now up about 40% on then. (and that is sold prices, not asking prices).

So my question is how long til prices return to levels of 3 years ago??

And also................ Used to be talk about the indexes which have now disappeared under the wieght of global financial meltdown.

Anyone care to update when Halifax, Nationwide, FT, Land Registry etc will go negative YoY?

Registers of Scotland 10.7% annual increase on last press release.

So its all very well but how long til I can afford to buy a house!!!! Not convinced I shouldn't have bought a couple of years ago!!

Thats an interesting question....

The reason this mess has came about is because of easy monetary policy. Rates were far too low, in an attempt to prevent a recession after the dot com bust. Its a natural result that when money is made available at such cheap rates, people will take it. There has been massive credit expansion in the last few years.

IF you look at interest rates and debt accumulation, they are in some ways inversely proportional. So when interest go down and bottom out, debt accumulation and money supply increase.

People think that it is the asset price that is going up in real value. However inflation is a loss of the purchaing power of money. SO when money supply increases, then its purchasing power decreases, making assets go up in price in relation to the paper money.

For example,...if on an island you have ten items, that get produced everyday, and you have ten notes. Each item will cost 1 note. Lets say we print ten more the next day, then we have each item costing 2 notes, print 50 notes and it costs 5 notes for each item. This is inflation.

On the other hand, we could reduce the number of items to 5 one day and keep the money supply constant at 10 notes then the item will go up to 2 notes each. This is supply problem which can cause inflation. Either way it is loss of purchasing power of money.

I m getting to my point about is it a good time to buy a house...lol,dont worry...

This housing boom has not IMHO been caused by a problem of supply, although I m sure there was some supply problems also. However, I think the demand increased from the increase in credit and money supply. Thats why we got members of the general public putting together property portfolios like never before for the BTL business.

Remember when money supply increases its value is reduced. So we get all these paper notes running after these assets and the more paper thats printed then our houses are increasing in value, when actually they are not, the bricks and mortar stay the same price relatively, even though our house is going up in value at 5% per month.

All this credit expansion, and purchasing power of money is reduced, ie, inflation, and the bank of England decide to raise interest rates to curb the money supply. This cycle goes on for a few years, and eventually the cheap money becomes more expensive to service. Its harder to pay back those notes now each month because we are paying more of them out to service our debt. The cheap money isnt so cheap now. Its lost its value.

Basically it was this easy monetary policy that has caused these bubble prices in assets. The problem also was this. The inflation figures from the BOE are fraudulent. Inflation has been running at between 6-10% per year here, according to some very well respected economists. The cpi is a con. That means that even when the BOE were raising rates, the rates were still below inflation. So as a consequence the debt and money supply continued to increase even when the BOE were tightening monetary policy. Inflation is still running higher than the peak that interest rates reached. This is how the credit expansion and asset inflation has got out of control and created this massive bubble of hot air.

Interest rates needed to be closer to the real rate of inflation rather than trailing behind by 3 or 4 %. Even during the tightening phase of this monetary policy money supply continued to rise.

The options are this...either interest rates are raised and we have a total collapse in asset prices and money supply is reduced,a few banks go bankrupt and clean the balance sheets, anbd then we start again, and money very slowly over time regains its value, or second option is, they ease interest rates to save a few banks, and prop up asset prices, but print money to do it, and cause high high inflation and then eventually have to raise interest rates to 10-15% to control it and then money becomes so expensive that it becomes very difficult to buy a house anyway.

So bascially, no, its not going to be a good time for quite a longtime to buy a house. If you buy a house now and in a few years time when interest rates will be a lot higher, like maybe 8-9% to curb the inflation caused by easy monetary policy then servicing that mortgage will be a nightmare.

The reason its not a good time to buy a house is that the central banks seem to believe in easy monetary policy and will choose the second option because HBOS are too big to fail and all that. So in that case in a few years interest rates will have to be very high.

Look at the people now who borrowed all that money at a low rate a few years ago, they raised interest rates to 5.50% and now they cant service that debt. So interest rates are low now, but in three years from now they ll not. I dread to think whats going to happen to these people who are struggling now, if rates go to 7-8%. Then they ll know a real credit squeeze.

So, this is my opinion, hope you can see my logic behind it. However who knows what will happen, things like this are hard to predict.

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I cant see them dropping that far without a major increase in unemployment or Interest rates, both of which are very low right now by historical standards.

Availability of credit is the factor which makes this HPC different from its predecessors (at least in the early stages).

Thanks to what's happened in the last few weeks, FTBs now can't get a 5x salary mortgage even if they're willing to take one out. Selling properties for this time last year's prices isn't going to work, because even if a prospective buyer is willing to pay that sort of price, no-one will lend them the money any more. Most fixed-rate mortgage deals above 90% LTV have been taken off the market, and even 90 now comes with a punishing IR. With buyers now having to put a hefty deposit up front and liar loans no longer being an option, prices are going to go sharply down because people won't be able to pay them at their current levels. It's as simple as that.

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The real issue going forward is whether prices stagnate or come back to 2004/2005 levels.

I cant see them dropping that far without a major increase in unemployment or Interest rates, both of which are very low right now by historical standards.

My plan is to wait a few more months and hopefully i can pick up a better deal or to buy something in the Auction.

All the bad news you could possibly think of has been thrown at this market and prices are only down by 0.4 or 0.6 per month. This doesn't look like a market thats going to crash.

They may not have dropped that much but if you read my previous post you will see why assets prices can be propped up at the expense of high inflation. The reason they havent crashed yet is that people still can use a credit card to keep up with monthly payments. The reason they havent crashed yet t because interest rates are still below real inflation rate and money supply until last year was still increasing. Once inflation really kicks in, and interest rates go up then a true crash will come...however maybe they will cut ( i hope not) and prop them up artifically and create an illusion of wealth and cause worse problems down the road.

measure the value of your pound against gold in a few years time...

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Availability of credit is the factor which makes this HPC different from its predecessors (at least in the early stages).

Thanks to what's happened in the last few weeks, FTBs now can't get a 5x salary mortgage even if they're willing to take one out. Selling properties for this time last year's prices isn't going to work, because even if a prospective buyer is willing to pay that sort of price, no-one will lend them the money any more. Most fixed-rate mortgage deals above 90% LTV have been taken off the market, and even 90 now comes with a punishing IR. With buyers now having to put a hefty deposit up front and liar loans no longer being an option, prices are going to go sharply down because people won't be able to pay them at their current levels. It's as simple as that.

That sums it up perfectly! Risk has been re-priced and dominos will fall.

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  • 294 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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