Saturday, March 22, 2014

Hysteria!

House prices to soar again as pension changes fuel increase of 30 per cent

An army of so-called “silver investors” will be spurred by new freedoms announced in the Budget this week. But brokers warned that a rush for mortgages could see house buying reaching unprecedented levels, pushing up property prices by 30 per cent.

Posted by hpwatcher @ 08:30 AM (5254 views)
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14 thoughts on “Hysteria!

  • It’s clear, the whole purpose of the changes to pensions, is to increase spending & taxes….to keep the fake recovery going.

    Well, I suppose it’s better than outright confiscation like Poland. Just shows how DESPERATE the tories are to win the next election.

    Watch out for rises in pensioner scams.

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  • mark wadsworth says:

    Getting pensioners into BTL might have been part of the plan, but I don’t think this will have much of an impact.

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  • Getting pensioners into BTL might have been part of the plan, but I don’t think this will have much of an impact.

    I agree – they simply won’t want the strain at their time of life. Everyone I know who has gone BTL constantly complain about the amount of trouble that it is.

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  • I was wondering what would replace the PPI heroin injection to the economy and now we know. House prices continue to defy gravity – I’ve just about thrown the towel in on this subject !

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  • I was wondering what would replace the PPI heroin injection to the economy and now we know. House prices continue to defy gravity – I’ve just about thrown the towel in on this subject !

    Just about EVERYTHING is being thrown in to keep that housing bubble going. Foreign buyers, the tax payer through irresponsible government schemes FLS & HTB, pensions…..the bigger they are the harder they fall.

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  • mark wadsworth says:

    HPW, they’ve got plenty of ammunition left though – scrap Business Rates, reduce council tax, reintroduce MIRAS, help-to-let etc etc.

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  • I think this will be the last bit of ammunition left, don’t think there is much resilience left in the arsenal now so it will be inflation time or bust at the first sign of any economic pressure prompted by external forces. Was interesting how Tesco was prepared to go down to a 1% margin to try to stem falling sales, car sales will also be an interesting statistic to watch as affordability is now primarily driven by leasing contracts rather than finance.

    Streets around my area are also awash with twenty somethings cars in the evenings who can’t afford to fly the nest, must be that pent up demand the EA’s go on about!

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  • mark wadsworth says:

    enuii, I’ve been hoping against hope that they’d run out of ammo since back in 2009 or 2010, but I was wrong then, have been consistently wrong ever since and I now take a more pessimistic view.

    They’ll just throw absolutely everything at it until owner-occupation rates are back down to just above fifty percent again, which at current trends will take another ten or fifteen years.

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  • …and even then (when owner-occupation is down to 50%) all it happens is a slight nudge to actually promote ownership, slight decrease in prices and everything is back to “normal” – owner occupiers have majority again, and push homeownerists policies. I see no reason for any momentum to build when the magical 50% is reached. I lost all hope.

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  • They’ll just throw absolutely everything at it

    They will if they can, but I see many other points of failure in the system…..the UK and it’s people are so stretched in terms of debt, there are many points of failure…it just takes one to fail. Remember the ERM – now who could have seen that.

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  • I think my biggest issue is that lines have been crossed, that in the past would have been a total anathama. In the past when there was a bubble or a house price crash a government would accept that this was their lot on their watch and let the adjustments be made. Both major parties, Labour and the Conservatives have crossed the line with regards to quantitative easing and low interest rates, which are no longer seen as emergency measures, but as every day tools of governence.

    I remember when house prices in london started rocketing in the early 2000’s. between 1999 and 2003, my property rose by 150% in value. Everybody was talking about a forthcoming bust ( unlike now, where most people are looking for more rises). When the eventual bust tried to take hold in 2007 and 2008, many people would have expected prices to drop to 2001 and 2000 levels. In fact in places like Ireland and Spain, this is exactly what has happened. 2007 and 2008 is now seen as the new benchmark for the UK. I do wonder when an eventual crash happens, ( which i am now more certain of than ever before, because of the rampant bubble mentality in London) whether any government Labour or Conservatives, will ever allow a true crash or whether they will try and put a safety net under hme ownnership using quanitatve easing, interst rates and some of the tools Mark mentions above and 2008 as the base year.. I am increasingly seeing people that are saying even if property crashed by 50% in London they would never be able to afford it. These are professional people that in the past could have easily got onto the ladder with a respectable property and worked their way up.

    I am really hoping for a conviction politician/ party to be elected in the future that grasps the housing crisis in London and brings in emergency powers for sweeping development and land reform. This issue is no longer about whether a house is worth it or not, it is what it is doing to millions of people that are trapped in renting and at the mercy of a private landlors who at any time can give them notice to move on.

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  • off to bingo to spend the last of my savings lol

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  • mark wadsworth says:

    BB: “I am really hoping for a conviction politician/ party to be elected”

    If that’s our only chance of prices renormalising, then we can throw in the towel right now, leverage up to the hilt on BTL and retire to live off the unearned income 🙂

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  • stillthinking says:

    If you have doubts about whether or not the housing bubble will be pushed too far then you should get out of sterling into another currency. Surely the lesson of the previous postponement was a whapper of a sterling collapse.

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