Sunday, October 26, 2008

How property prices have plummeted in cash crash

When the tabloids start using the "c" word it's game over

A SEASIDE flat which a year ago fetched £133,950 has now sold for a PITIFUL £15,500 as house prices across Britain nosedive, the News of the World can reveal. The staggering 88 PER CENT price drop is the starkest indication yet that the credit crunch has sent now the housing market into freefall. Our investigations turned up scores of properties—most of them repossessed by banks and building societies— that are now worth a fraction of their previous value. A riverside apartment in BIRMINGHAM which fetched £157,000 a year ago, sold for just £68,000 at a London property auction—a price drop of 57 per cent. A smart, open-plan flat in PRESTON failed to sell, despite a reserve of just £80,000—less than half its £199,995 sale price two years ago.

Posted by little professor @ 08:36 PM (1320 views)
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13 thoughts on “How property prices have plummeted in cash crash

  • little professor says:

    Ah, got my headlines mixed up there. Sorry.

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  • A real catching piece of journalism that is bound to be widely read. Quite shocking news for non HPCers. Actually it’s devastating news for the housing market. Could start a panic, but what can anyone do? Whether you’ve got a mortgage or paid cash we’ve all been ‘had’ one way or the other. This is a severe loss of personal wealth.
    Where is everyone? Wakey! Wakey!

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  • Could start a run on banks for sure.

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  • japanese uncle says:

    What a horrendous pace of the HPC in just a year and a half! 90% HPC is London 70% overall in three years time seems in the bag.

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  • japanese uncle says:

    One more thing;

    Unlike the banks in the US where non-recourse loan is the common practice, UK banks may tend not to care about the fire sale, bringing down the house prices dramatically. As a result the pace of HPC can be much faster than in the US.

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  • dohousescrashinthewoods says:

    Asset deflation, hot on the heels of rampant price inflation caused by maniac credit expansion.
    When it finally happens it’s almost an anticlimax – it’s all long over bar the sob stories on the Beeb.
    Check mate was sealed last autumn, it’s now just a matter of time before good ship Blighty, floating on a balmy sea of hpi, sinks.
    Gaww blesser and all who sailed in her.

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  • It would have been possible to buy the flat on a credit card. Ha Ha ha.

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  • last_days_of_disco says:

    @sovietuk

    No, use the credit card for the 15% deposit, get a fixed rate for 5/10 years at 6%. Its cheaper and still 100% based on credit.

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  • excellent news, i might just make another offer based on that news…

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  • planning4acrash says:

    What people forget is, that, a 90% fall would be harsh for a few years, but, government would become irrelevant, taxes slashed from no need for housing corporations, housing benefits, etc. Without that massive burden, people could start saving and investing in production instead of wasting it on the government tax-ponzi scheme that benefits from and attempts to continue high house prices. I think I want to change my screen name to come-on-correction!

    Maybe that will be a time to get Council Tax re-evaluated!! Everybody on the bottom band!!!!

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  • mark wadsworth says:

    The “c” word is degrading to women, but in this context, fair enough.

    P4AC, that’s the point about Land Value Tax – to keep house prices down permanently, give town planners a simple way of deciding whether to approve something or not and also to channel credit into the productive economy and away from land price bubbles. And every plot would be in the right band.

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  • Home Counties Expat says:

    Is it a risk, what with all the buy to let that’s been going on over the last 6/7 years, and the thousands of new new flats that have been built up and down the country, that 1 or 2 bedroom flats will practically become unsellable and therefore completely worthless??

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  • Even UKIP have rejected LVT. Why go on about it ?

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