Tuesday, July 29, 2008

Reality is finally biting

Property deal volumes slump 50%

Liam Bailey at Knight Frank considers if any parts of the UK market are proving immune to the current downturn. "...the reality is for most people now if you want to sell your house people are accepting they have to take 10 per cent less than they would have got last October." "...In a sense you could argue what we have now is actually a normal mortgage market. I mean certainly 10 or 15 years ago this was normal." "...when do prices stop falling and then begin to rise, and probably that's 2010"

Posted by doomwatch @ 05:15 PM (928 views)
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5 thoughts on “Reality is finally biting

  • “In a sense you could argue what we have now is actually a normal mortgage market. I mean certainly 10 or 15 years ago this was normal.”

    Quite right! Why do so few people seem to understand that the last 5 years in particular were a complete and utter abnormality that have virtually no historical parallel.

    The current bust is a necessary and normal sequitur of the preceding boom, and the faster we get back to normal, the more money people will have for the OTHER essentials of life.

    Just think, if you could have the same house for a third of the mortgage, wouldn’t it be a lot easier to deal with high food and fuel prices?

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  • japanese uncle says:

    “..the reality is for most people now if you want to sell your house people are accepting they have to take 10 per cent less than they would have got last October.
    —————————-
    Unfortunately many have to take 20% less than six months ago, some 30% less in reality. In six months time, it will be ‘40%’, and eventually ‘60% less’ (some will have to offer 70%). So the sooner you sell you house at sizable discount, the less discount you might have to offer after all. But as a whole such process will accelerate further the already serious HPC, into the housing stanpede (which sounds quite appropriate to describe the situation).

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  • There are always buyers at a given level although in many places you will still need to have a mortgage to be able to buy a property, a 70% drop wont suffice. We may go back to the situation during the 70s when property prices crashed but no mortgage were available, so the only buyers were the elusive cash buyers. Since most people wealth is tied up in their property, there is also a risk that the drop of house prices is as much a paper loss than it has been a paper profit for the last ten years.
    Those in dire straights who need to sell may not be selling the best properties while those who can afford to wait will wait. We could go back to the 90s when there was a glut of c… properties on the market and nothing else. That bargain we have now been chasing for months may never materialise.

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  • 10% off is a joke.

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  • After a lot of bitterness, winding up ect, and hard lucks, I would like to here comments from home owners who brought there house to live in ,not to make money on,I own my home no motgage,I brought 25 years ago,and I am behind the Lets have a crash camp, a 30% drop would be good,it would kick in the economy, take 40% off the council house list, saving the government a fortune,the y generation would be happy again, then when all this kicks in,I think there should be some sort of tax to pay on selling a property outside its real value, local councils could sort this out with ratable values,for diferent areas,and the vendor can negative gear the agents fees stamp duty ect,only if moving to another property or retiring, this is just an idea?

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