Monday, July 28, 2014

Housing crash now on

Confidence in market plung

This bubble is starting to burst even before rates rise..this bubble especially in London is so big I can see 60-70% falls being headline news for many years

Posted by taffee @ 06:36 AM (6648 views)
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18 thoughts on “Housing crash now on

  • 23 Jan 2014 – London Property a `New Asset Class,’ says Boris Johnson
    Sep 2013 – “We’re a million miles away from a housing bubble in this country” – Nick Clegg

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  • Hmm perhaps not a crash, but TPTB need to chuck more money at the old dog.

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  • so good for their BS propaganda for the election its going bad

    as for carney he got what he wanted high house prices, stagnant economy, people slaves to tax, just like canada before he left it to rot

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  • People have been predicting a house price crash for the last 10 years now.

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  • What goes up…..will come down.

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  • 6070% falls??? you’re living in a dreamworld

    prices wont; go down massively, because people wont sell for a loss like that…..

    wise up and grow up

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  • as for carney he got what he wanted high house prices, stagnant economy, people slaves to tax, just like canada before he left it to rot

    Someone else is sorting out the mess he left behind…..

    People have been predicting a house price crash for the last 10 years now.

    Indeed, and even a busted clock is right twice a day……so following that logic, there will be a crash at some point….we all know it.

    The issue is that the economy is on the floor, wages are going nowhere, lowest IR in 300 years, FLS then HTB…..all are important factors in the mix,

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  • Hpwatcher @ 6 above:
    +1

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  • They state, citing this study, that buyer confidence is the lowest ever, yet the study only began in 2011.

    We also see that the market is shifting from home buyers to BTL because none of the mortgage market changes effected BTL, so it is a brave new world out there of servitude. Frankly, it all goes down to oil prices. If they collapse down to $80 a barrel, IR’s go negative and we get a fresh house price boom.

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  • this is almost certainly the peak…….whos gonna rent all the buy to lets when prices plunge?….going to be a spiral of btl portfolios
    forced to sell and ftbs will maybe buy them…but when bubbles unravel they kill sentiment…in japan people still baulk at property as an investment 20 years after their bubble burst

    some property could fall 50-70% and still look toppy especially in London

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  • I was speaking to an old acquaintance a couple of months back who made a lot of money via finders fees in the noughties mainly via people based in London buying off plan in North-East England. At one time this guy also had quite a little BTL empire going. I asked if he was still “trading” to which he replied people were now unwilling to purchase property in the North because of continuing falling prices. Properties at the top end of the market have had hundreds of thousands of pounds wiped from their value. It will be interesting to see if it happens in the South East (personally I cant see it)

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  • Rental demand is flexible, people living at home longer, living in the annex, house sharing 10 immigrants to a 3br semi.
    What BTL’ers do not realise is that if the FTB couldn’t afford the mortgage repayments at a certain level and the BTL’er outbids them then they are almost certainly not going to be able to afford the rent payments. Just exactly who to BT’ers intent to rent to, I’d love to see their (lack) of business plan.

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  • and we get a fresh house price boom.

    Hahahahahah libby comes in with something comforting for housing.

    Getting nervous?

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  • britishblue says:

    I don’t think we have hit peak yet. In London it is like a wave coming out. It has gone through Central, Kensington, Chiswick, Richmond and Kingston and is now in places like Tolworth, Sunbury and Staines. In other parts of London the wave has probably gone to dodgy places like Tottenham. Houses are still going for fixed bids in the outskirts of the south west of London, when it has dried up further in London. I am still dealing with people who are reeling with shock at what people have offered for their house. I am also dealing with a few more people that are selling to rent.

    I was really hoping for a major event rather than a fizzle to pop the bubble. Then a huge drop, where everyone looks at everyone else and says how come know one saw this coming.

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  • I don’t think we have hit peak yet. In London it is like a wave coming out. It has gone through Central, Kensington, Chiswick, Richmond and Kingston and is now in places like Tolworth, Sunbury and Staines.

    Possibly. But the FLS money has been exhausted and the tough new mortgage rules have now come in.

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  • @libertas you are deluded and do not understand how economics work. If oil sinks other commodities will tank it will lead to deflation where real value of money drops,it increases the real value of debt, and aggravate recessions (See Wikipedia). It will in fact accelerate the crash.

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  • @17.

    um, i agree with your sentiment, but deflation increases the value of money. you can buy more with the same amount of money. Effective cost of debt servicing increases as generally wages/earning will deflate in line with reduced commodities prices and reduced economic activity. however i don’t think you can say the value of debt increases. maybe you can get away with saying the value of credit increases, as after all money = credit.

    Libby is wrong because it’s less important what the price of oil does, but rather why the price of oil moves. I.e. if we have a massive deflation episode and demand drops off, this is obviously bad for the prices of everything. If world peace breaks out and there are large oil fields brought into production, and the price falls, then this will be good for the economy, and the housing market.

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  • Nod2glod ,

    “If world peace breaks out and there are large oil fields brought into production” .

    The cost of maintaining the House of Saud and stability in the region requires $100 bbl , even with lifting costs of only $10/bbl .

    Everyone assumes Oil and Gas is hugely profitable but that is no longer the case and the exploration side of things looks to be losing money in aggregate .

    Already those oil and gas majors which are listed are cutting back on R&D and exploration in order to maintain a dividend .

    It takes time to develop a province – most of the giant fields we are depleting now were discovered 40 or more years ago .

    The danger I see is that lack of investment now could lead to a lack of supply in the medium term .

    For that reason , IMHO , it is in the long term interests of consumers and producers for oil prices to remain above $100/bbl .

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