Friday, April 27, 2007

It’s getting closer…..

First house prices drop for five years

More evidence on declining Irish property market. Watch the Irish sell off their UK property over the next few months. Clear evidence of our own crash will follow shortly.

Posted by royston @ 12:47 PM (1870 views)
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11 thoughts on “It’s getting closer…..

  • David20040_0 says:

    No Royston it isn’t. It isn’t clear evidence of any crash in the United Kingdom.

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  • “Permanent TSB’s Niall O’Grady said interest rates and uncertainty over stamp duty were both affecting demand.”

    Er, Yeah. And like, maybe like, cos they were totally overvalued in the first place too(?)

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  • dohousescrashinthewoods says:

    US, Spain, Ireland, maybe France – there seems to be an unfolding story?
    I wonder how long it will be before reality hits the UK?

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  • Shipbuilder says:

    I suppose this could go either way in Northern Ireland. Most of the price rises here seem to be speculation, and significant proportion would be from the South, who, remember, can borrow at a lower rate.If the ROI market collapses, I guess investors will either buy more up here to hedge against losses in the South, or sell up to cover the losses. It’s hard to tell which.
    I’ve been thinking recently, it actually is ‘different this time’. Previous booms/busts have been caused by economic factors – recession, IR rises or some such. We’ve now had the US and Ireland peak and start to go down, both in eras of economic growth and high employment (ROI IRs are lower than UK, but they’re crashing first). Yes, the economies are funded by debt, but these days people seem much happier with debt, as long as employment is secure. I believe that the biggest single factor we will see in all of the downturns is sentiment. The biggest difference in the last 10 years is the internet – availability of info is huge, and I think people are more affected by it – i think we’re seeing media-influenced downturns – people are starting to get panicky about things and putting their plans on ice. We were wrong to believe that a crash would happen without the media’s influence. The other thing, of course, is BTL. It’s probably easy to predict that professional investors will follow common sense, but with so many amateur landlords, who knows? These two factors are why I am starting to think that predictions of when are a waste of time. It will all seem obvious in retrospect.

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  • Planetmervyn says:

    For the first time in my life, I believe I may have got something right, finally. I sold my humble 1 bedroom home two years ago because it was too small and the monthly mortgage payments, too painful. I now rent a much bigger place in a fantastic location, with no mortgage worries…just biding my time watching and waiting for the HPC…Couldn’t be happier.

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  • I think it has already started to hit the UK in places. It is just that the media, UK estate agents and govt can conceal it (up to a point), but they cannot do this with overseas problems.

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  • tyrellcorporation says:

    IMHO the UK will be last to go because of our national obsession with home ownership and the remarkable sophistication of all the VI groups involved. From EAs to Banks and lenders (PR depts, etc), media types with property portfolios, politicians with property portfolios, millions of amateur landlords and property developers, Krusty and Phil, Beeny, Grand Designs, Place in the Sun, etc, etc, etc. It will take an almighty effort to negate this torrent fo spin but when craks start to appear the dam will go quite quickly.

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  • Tyrell, you are right. Property programs have been done to death, but the tide is turning. The only question is will we have a correction, a depression, or an apocalypse?

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  • sold 2 rent 1 says:

    It is different this time compared to 1991.

    We haven’t got rampant inflation with crushing IR.

    All the countries with falling HP have growing economies and low IR (in historical terms)

    What we are seeing is the debt creation that has been steadily growing for the last 70 years reaching it sustainable limit.

    As the economies tip into recession the debt levels will grow as a proportion of GPD and this will create a deflationary trap where no reduction of IR can stimulate demand.

    The situation is dire.

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  • Shipbuilder,
    good observation, we are in good times and people are crashing under debt, people should have saved a lot, no they have borrowed like maniacs in the boom years! … what the f***!
    the very first even minor shock (I am not saying should ever happen, hopefully never!) but imagine a oil shock, a minor terrorist threat, a recession in Spain and Ireland, a recession in the US… are these stupid things that cannot happen, true David2004?
    UK is destined to go down in tears because is built like a house of cards (not to mention the vast availability of unused land, former industrial sites etc that will catch up with just any housing demand you can forecast)

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  • Bought at a bargain in France the end of January. Winter property sales apparently had been bad. Our offer was insanely low [ and I mean ridiculous], but instantly accepted. We were, for once, in the right frame. There had been news reports the French market was falling off and ready to take a positive nosedive. But, in February, things gained momentum, then in March and April the prices took off again at full bore. Good thing our deal is secure — because we are watching property here rocket higher by the week. Evidently an anomaly, considering what is observed elsewhere [Spain, Ireland] at the moment.

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