People Still In Denial

[eastleighfan]

We were having lunch , last night , and the conversation got round to falling house prices ( wonder who started that off ) .

One of the blokes is a true bull . He said he is encouraging his daughter to "buy any property , even if it's just a small flat . You need to get your foot on the ladder " .

Me : I wouldn't touch property with a bargepole , prices are in freefall "

Him : "Nahhh , they are going down a bit , but will be back by Christmas"

Other bloke :"Yeah , I reckon by next year , prices will be back where they were "

Me : No one's buying ,and there are 15 buyers to each property , apparently "

1st Bloke : That's a false picture , people want to buy , but can't get the money"

me " So the only way to sell is reduce prices "

Silence for a few seconds

1st bloke "nahhhh ..prices will be up again by Christmas , property always goes up ..." etc etc

I just got on with my lunch , and the subject went to something else

When are people going to accept it ??

[Minos]

We were having lunch , last night , and the conversation got round to falling house prices ( wonder who started that off ) .

One of the blokes is a true bull . He said he is encouraging his daughter to "buy any property , even if it's just a small flat . You need to get your foot on the ladder " .

Me : I wouldn't touch property with a bargepole , prices are in freefall "

Him : "Nahhh , they are going down a bit , but will be back by Christmas"

Other bloke :"Yeah , I reckon by next year , prices will be back where they were "

Me : No one's buying ,and there are 15 buyers to each property , apparently "

1st Bloke : That's a false picture , people want to buy , but can't get the money"

me " So the only way to sell is reduce prices "

Silence for a few seconds

1st bloke "nahhhh ..prices will be up again by Christmas , property always goes up ..." etc etc

I just got on with my lunch , and the subject went to something else

When are people going to accept it ??

Chin up they said. The war will be over by Christmas.

[Killer Bunny]

When are people going to accept it ??

When they say prices will never rise again, guess what you should do...

[AteMoose]

We were having lunch , last night , and the conversation got round to falling house prices ( wonder who started that off ) .

One of the blokes is a true bull . He said he is encouraging his daughter to "buy any property , even if it's just a small flat . You need to get your foot on the ladder " .

Me : I wouldn't touch property with a bargepole , prices are in freefall "

Him : "Nahhh , they are going down a bit , but will be back by Christmas"

Other bloke :"Yeah , I reckon by next year , prices will be back where they were "

Me : No one's buying ,and there are 15 buyers to each property , apparently "

1st Bloke : That's a false picture , people want to buy , but can't get the money"

me " So the only way to sell is reduce prices "

Silence for a few seconds

1st bloke "nahhhh ..prices will be up again by Christmas , property always goes up ..." etc etc

I just got on with my lunch , and the subject went to something else

When are people going to accept it ??

People accept it when they are no longer interested in property, i.e. they accept it when we have reached the trough... When people look at you like your insane when you talk about property THATS the time to get heavily into BTL

Edited July 21, 2008 by moosetea

[boo]

Its amazing how many people have their head in the sands. Was talking to my landlord who isnt a buy to let magnate they used to live in our place and then bought a bigger house, he was always suprised at how high prices were and thought they were stupid. He also had his fingers burnt in the 90s as they bought the place we rent at the top and lost 30% in the first year.

Anway we were talking and he asked if we would buy soon, I said no as I believe prices will drop further. He replies saying he was pissed off as the flat below us is on for 330,000 and last year they were 375,000 so he has lost 45 grand. I told him he hadnt lost it as he should be looking at how much his mortgage is compared to asking prices, its still a lot more than he paid. He them comes out with "London wont drop, the olympics are coming, interest rategs are only 5% (???!!) and inflation is only 3% (!!!!?!!!!!!!!)"

There is no talking to some people, its just greed. He probably only paid around 100 grand for our place yet sees a drop of 375,000 to 330,000 as a loss

Edited July 21, 2008 by boo

[Timil]

There are complete muppets out there with a veneer of prosperity mostly built up in the last 15 years because they happened to buy a house, which has subsequently has been mewed to exhaustion spawning BTLs, cars, holidays, plasmas etc etc.

They won't accept the golden goose is dead until people are clearly running away from decomposing property market.

[Laura]

It may take a long breakdown of the food suppy chain before most 'get it'.

Maybe not even then

Nope, not even then.

It's blip mentality

This is Britain; we don't do chaos here

[thedebtisreal]

Why, oh, why did you bring up property discussions at work? One of the blessed reliefs of this bust is not having to discuss the housing market anymore or defend my views. I didn't even jump one of my colleagues who had the bright idea of buying an off plan flat in New Cross.

The only people I show my true colours to are the FTBs who are stretching themselves for their first home and my closest friends and family.

Everyone else, well, they pays their money, they makes their choice.

[Alfie Moon]

Yep, I've come across some people that say "it will all be going back up by Xmas, the lenders will have created some decent mortgage products by then, they always do, etc."

However, there are also loads of people accepting that we are in for a long term of dfalling prices and that this is actually a good thing. Quite a lot of bitterness being expressed about BTL and that houses should be 'homes' not 'for profit'.

[symo]

The UK housing market is living on the skin of it's sentiment. Game over.

[JohnnyB]

The Juggernaut is finally completing its year long turning circle, these numpties will work it out soon enough, when prices don't bounce back by Xmas, and their friends start losing their jobs, and they can't pay for that Carribean Holiday anymore, or even a trip to Butlins. Some will cling on to the idea that the end is just around the corner, and as FP said, when those people turn bearish, that is the time to buy.

[Alfie Moon]

I suspect the smell of fear will be quite strong by Xmas and the New Year as a recovery fails to materialise and the situation become visibly worse.

The other 'denial' explanation I come across is that - if newspapers would stop scaring people it would all return to 'normal' (ie lenders giving out 6 times income mortgage loans and prices rising by 20% per year, etc.). These same people argue that newspapers will get bored of 'house price falls' stories by the end of the summer, and because it won't be in the headlines anymore house prices will return to rising again.

It is pointless to argue against such delusions!!!!

[The Masked Tulip]

Why, 'last night', were you having 'lunch'?

[frozen_out]

Some will cling on to the idea that the end is just around the corner, and as FP said, when those people turn bearish, that is the time to buy.

I would leave it till a while after that. I'm looking out for two buy signals:

1) Hearing someone say that they don't think property will ever increase in real terms again

2) Hearing someone say they don't think they'll ever escape negative equity

[Guest pioneer31]

I sometimes wonder if Britain is one of the thickest nations on Earth

[deadman]

Why, 'last night', were you having 'lunch'?

On nightshift maybe?

I am surrounded by thick people. One of them is my niece who has just bought a house that she can't afford. :angry:

[Nationalist]

Why, 'last night', were you having 'lunch'?

Yes, I was wondering that too. Strange.

[DoctorJ]

I think that we have been blinded by the 'promise' (NuLab) of unlimited property growth and guaranteed riches, so long as you get a big house and then sit on your backside for years waiting for the greater fool to come along.

From talking to people recently, many just don't know whats happening any more. Whereas, over the past 5 years increasing house prices were a given. Some people acknowledge that if they sold now they would make a loss but keep saying that these things are cyclical and so sitting tight, and waiting for the upturn, is the best policy. Most others expect (want/need) a short term blip and then a quick return to August 2007 levels, and beyond.

A common theory is that the SE (where I live) will be largely unaffected due to concentration of jobs and money etc and that prices nationwide will be brought down by other areas in the UK. I'm not so sure about this. Plus, with the city taking a beating there will be less cash floating around the SE. But this then goes back to the 'cyclical' argument.

Generally though, most don't seem to want to talk about it as much as when the boom time rolled on and on. I put it down to general confusion at the moment. Still in the FEAR stage imo.

Edited July 21, 2008 by DoctorJ

[lulu]

On nightshift maybe?

I am surrounded by thick people. One of them is my niece who has just bought a house that she can't afford. :angry:

But at least she is "on the ladder" and surely many years of negative equity and hassle from the banks will be all worthwhile in the end.

[Jim B.]

I don't know if people are thick, it's just that they have been fed the same line on property for the last 10 years with hardly anyone saying the opposite. It will take a while for such a mindset to change. I expect the older people will be quickest to see, having lived through these things before, but anyone in their 20's will have no experience of this and will have been watching LLL for the last 5 years.

[Leonard Hatred]

I don't know if people are thick, it's just that they have been fed the same line on property for the last 10 years with hardly anyone saying the opposite. It will take a while for such a mindset to change. I expect the older people will be quickest to see, having lived through these things before, but anyone in their 20's will have no experience of this and will have been watching LLL for the last 5 years.

In my experience, the ones who have lived through it before are the worst offenders

[Shrink Proof]

In my experience, the ones who have lived through it before are the worst offenders

But surely that's because it's different this time....

[thedebtisreal]

In my experience, the ones who have lived through it before are the worst offenders

Agreed, but that's because they know house prices cannot possibly fall unless interest rates hit 15%. That's the magic figure. 14.75% is too low to cause a crash.

On a side note, don't you think it interesting that people think that rising house prices are a GOOD thing and rising inflation is a BAD thing, but can't see the link between the two.

[Bloo Loo]

People will begin to understand if they take a look at their property.

lets see, its got 3 walls and a party wall if they are lucky.

its got a roof, some fixture and fittings.

maybe a bit of Garden

And they think its worth TWO HUNDRED THOUSAND POUNDS!

reality must dawn soon. they wil begin to realise that its not £800/£1000/£1500 per month they are defending, its the big drop at the end of the climb they are looking at.

[r thritis]

Many seem to have been unable to make a distinction between what they want to happen and what was likely to happen. This blind 'wishful thinking' seems to have affected even hardened experts and seasoned professionals.

In the past few years I have spoken to financial advisors who had convinced themselves that it was sustainable for property price increases to outstrip wage increases effectively for ever. Their blindness in this seemed to be driven by their own circumstances and their perceived horror of a falling market - to the extent that they could not even contemplate it.